The value of good Indiana farmland has increased 22% over the past year, according to new data from the Seventh Federal Reserve District in Chicago. The Fed says for the last quarter of 2021, the value of the state’s farmland increased six percent over the previous quarter.
The 22% increase mirrors the increase across the district, which includes all or part of Indiana, Illinois, Iowa, Michigan and Wisconsin. Fed economists say it is the largest increase in over a decade.
“Farmland values soared 22% in 2021 from the year 2020. So a huge gain. The largest since 2013,” said Federal Reserve Bank Senior Business Economist David Oppedahl.
Of the five states, only Iowa had a higher annual increase than Indiana, with a 30% jump. For the last quarter of the year, the district saw a seven percent increase.
The data is based on a survey of 147 agricultural bankers. Of that same group, 56% expect farmland values will continue to rise during the January through March period and 43% expect them to remain the same.
Oppedahl says district farmland values were helped by another jump in corn and soybean revenues. Revenues for these crops were up not only because of production growth in the five district states, but also because of higher crop prices.
“Overall credit conditions in agriculture are quite favorable and continuing to improve. It’s been a period with strong revenues that have boosted the ability of farmers to repay their loans,“ said Oppedahl.
All states in the district had higher yields for both corn and soybeans in 2021 than in 2020, even with drought across a substantial portion of the region. Click here to read the report and view Oppedahl’s comments.