Farmland values across the central Plains eased somewhat through the first quarter of 2018, reports the Federal Reserve Bank of Kansas City. The bank notes values for non-irrigated and irrigated cropland as well as ranch/pastureland declined 3% on an annual basis. The steady-to-weaker trend in farmland is not a sharp as the decline in net farm income.
"Compared with declines in farm income, declines in farmland values have remained modest," the bank states. "In the mountain states and western Missouri, values for non-irrigated farmland and ranchland increased slightly. On the other hand, the largest declines in farm real estate values were in Nebraska, a state with the largest share of agricultural lending in corn and soybean production," the bank notes.
The bank also reports cash rents for cropland continue to ease. "Cash rents for non-irrigated and irrigated cropland fell by about 3% in the first quarter of 2018. Rental rates for ranchland increased for the third straight quarter, which has likely been due to relative strength in cattle prices. In fact, some bankers commented that operations with cattle had better returns than grain-only farms in 2017," the bank states.