By Andrew Joseph, Farms.com
American farmland real estate values jump by 18 percent over numbers from 2020 Q3 in a five-state region.
In the Seventh Federal Reserve District that includes all of Iowa and much of Wisconsin, Michigan, Illinois and Indiana, the Chicago Fed—aka the Federal Reserve Bank of Chicago that serves the District—it is believed that the large increase in values is related to the higher crop prices achieved this year.
The 18 percent increase is the largest such jump in nearly 10 years, noted the Chicago Fed, and added that the valuation increase was aided by high incomes and low interest rates, and corn and soybean futures hitting multiyear peaks thanks to bad weather affecting yield.
On the downside, the high value of farmland adds to inflation concerns as raw material prices rise along with transportation rates—all bad news for consumers.
Photo by Tim Mossholder on Unsplash