U.S. News: Farmland Prices Rise Despite Drought
Land prices in the Farm Belt continued to surge in the third quarter, even as a severe drought battered crops and slashed some farmers' incomes.</br></br>Farmland values in the heart of corn-growing country, including Illinois and Iowa, jumped 13% in the three months through Sept. 30 compared with a year earlier, according to a report Thursday by the Federal Reserve Bank of Chicago.</br></br>Meanwhile, prices of nonirrigated farmland in a seven-state stretch of the Great Plains soared 24% from a year ago, a separate report from the Federal Reserve Bank of Kansas City said.</br></br>Although the increases in prices slipped slightly from the year-over-year growth seen in the second quarter, the reports confirmed anecdotal evidence that demand for farmland has scarcely been dented by the worst U.S. drought in decades.</br></br>High prices for crops, including corn and soybeans, have mitigated the drought's financial impact on farmers. Also, many growers are protected against losses in production by crop insurance. Net U.S. farm income is expected to rise to $122.2 billion this year, up from $117.9 billion last year, according to the U.S. Department of Agriculture.