Saturday, August 17, 2013

Farmland Values Rise; Cash Rent Av. $182 Acre – St. Louis Fed Reserve

AgFax.Com - Your Online Ag News Source


Farmland values continued to rise during the second quarter of 2013, according to the latest Agricultural Finance Monitor published by the Federal Reserve Bank of St. Louis. Farm income, as well as capital and household spending, also increased slightly compared with a year ago.

The survey for the report was conducted from June 11 through June 28, 2013. The results were based on the responses of 48 agricultural banks located within the boundaries of the Eighth Federal Reserve District. The Eighth District comprises all or parts of the following seven Midwest and Midsouth States: Arkansas, Illinois, Indiana, Kentucky, Mississippi, Missouri and Tennessee.

Farmland Values

On average, Eighth District quality farmland and ranch or pastureland prices were higher than first-quarter 2013 and second-quarter 2012 levels. In addition, many lenders reported that they expected prices for quality farmland and ranch or pastureland to increase in the third quarter relative to the third quarter 2012.

Quality farmland prices averaged $5,672 per acre in the second quarter of 2013, up 11 percent from an average $5,111 in the first quarter of 2013 and up more than 20 percent from $4,705 per acre in the second quarter of 2012. Ranch and pastureland prices were also slightly higher in the second quarter of 2013, with District lenders reporting average prices of $2,372 per acre, up about 4 percent from $2,274 per acre in the first quarter 2013 and up close to 1 percent from $2,349 per acre the previous year.

Looking ahead to the third quarter, lenders reported that they expect land values to rise relative to last year. A proportionately larger number of respondents expect values to increase for quality farmland and ranch or pastureland in the third quarter relative to a year earlier, the report said. Using variables based on diffusion index methodology, the average expectations index for quality farmland in the third quarter of 2013 was 127, while for ranch and pastureland prices, the index value was 108. (With diffusion index methodology based on survey responses, 101-200 indicates overall expectations of higher values, while 0-99 indicates expectations of decreasing values. A value of 100 indicates expectations remain the same.)

Farm Income

Average farm income and spending rose slightly in the second quarter of 2013 compared with a year ago. “On net, respondents indicated that second-quarter District farm income, along with capital and household spending, increased modestly relative to their respective levels one year ago,” the report said.

Based on diffusion index methodology, survey results showed an actual income index level of 108 for the second quarter of 2013 across the District. Looking ahead at the third quarter, lenders indicated they expected lower farm income, with survey results showing a diffusion index value of 91. “Across the District, bankers expect farm income to fall over the course of the next quarter compared with the third quarter of 2012,” according to the report.

Cash Rents

Average cash rents per acre for quality Eighth District farmland during the second quarter of 2013 were higher than the first quarter 2013 and the second quarter of 2012.

For the second quarter 2013, cash rents for quality farmland averaged $183 per acre, up 6.7 percent from an average $171 per acre in the first quarter 2013 and up 12.9 percent from an average $162 per acre the previous year. Meanwhile, lenders reported cash rents for ranch or pastureland of $57 per acre, down from the first quarter’s average of $64 per acre, but remaining above last year’s average of $53 per acre.

Looking forward, lenders expect rents to increase in value for all land categories during the third quarter of 2013. The report also noted that “anecdotal information collected from other sources suggests some shift in cash rents toward a variable or profit-sharing basis,” and that this shift may not be fully captured in current cash rent data.

Ag Loan Demand and Repayments

On average, lenders reported that while demand for agricultural credit across the District remained unchanged in the second quarter compared with a year ago, they expected loan demand to pick up in the third quarter. In addition, survey results showed more funds were available to prospective borrowers during the second quarter of 2013 than a year ago, and this should remain the case in the third quarter. Loan repayment rates also remained essentially the same compared with a year ago, and expected to remain unchanged in the third quarter. Average interest rates on most types of loans increased slightly from the first quarter of 2013, with rates on variable interest loans increasing more than fixed-rate loans.


Tags: , , , , , , , , , ,


Leave a Reply

Name and Email Address are required fields. Your email will not be published or shared with third parties.

Sunbelt Ag News

    National Corn Growers Association Names New CEO — DTN9-2

    DTN Grain Midday: Wheat Trade 7 to 13 Lower9-2

    Brazil Soybean Exports Decline in August — DTN9-2

    DTN Cotton Open: Tumbles to Five-Session Low9-2

    South Carolina: Crop Production Field Day Set Sept. 25 at Blackville9-2

    DTN Livestock Open: Cattle Futures Starting with Firm Undertone9-2

    DTN Grain Open: Higher on Light Buying Interest9-2

    Keith Good: Rail Service Problems Persist; Hog Prices Rebounding9-2

    Texas Cotton Industry Mourns The Death Of Economist Carl Anderson9-1

    Livestock: Market Lessons from 4-H County Fairs – DTN9-1

    China Cotton: Reserves’ Quantity, Quality Cause Problems – DTN9-1

    Welch on Wheat: Spring Wheat Harvest Running 22% Behind9-1

    Welch on Grain: Corn Condition Improves, Well Above Average9-1

    Flint on Crops: Rain Is Better Than Well Water9-1

    Rose on Cotton: Plenty of Gaps and No Rallies Expected8-29

    Peanut Harvest In N. Fla.; Drought Pushes Digging In Lower SE – AgFax8-29

    Rice Crop: Looking for a Normal Crop, Not a Bumper8-29

    Rice Market: Being Short Tricky but Being Long Takes Patience8-29

    Peanut Stocks and Processing: Utilization Up 2%, Stocks at 1.9B lbs8-29

    Cleveland on Cotton: Chinese Demand Pulling Prices Higher8-29

    DTN Livestock Close: Cattle Futures Sharply Higher on Positive Cash News8-29

    Doane Cotton Close: Futures Unable to Recover Losses8-29

    DTN Cotton Close: Late Rally Leaves Dec. Flat8-29

    AFB Grain-Soybean Close: Modest Losses Across the Board8-29

    AFB Cotton Close: Dec. Moves Fractionally Lower8-29

    AFB Rice Close: Futures Chart New Leg Down8-29

    Farm Bill: Cotton Transition Assistance Enrollment Now Open8-29

    Are USDA Corn Yield Forecasts Getting Better or Worse Over Time?8-29

    DTN Grain Close: Markets Settle Lower Ahead of 3 Day Weekend8-29

    USDA: Peanut Price Highlights8-29

    DTN Livestock Midday: Hog Futures Surge Higher8-29

    Farmers with Foreign Assets Face New IRS Rules and Serious Penalties8-29

    Mississippi Outdoors: Beaver Management Not a Simple Issue8-29

    Arkansas: Flood Damage to Crops Valued at $35.6M8-29

    Delta Soybean Yields Start Strong; Sugarcane Aphid Marches On – AgFax8-29

    California: Pinnacle Announces Acquisition of Kerman Ag Resources8-29

    Midwest Farm Lenders Expect Solid Output; Lower Farm Income – Federal Reserve8-29

    Farm Payments to Stakeholders Rise as Gov. Payments Decline – USDA8-29

    Young Farmer in Your Future? – Helping Him or Her is Key to Success. – DTN8-29

    Net Farm Income Forecast to Fall,10.6% Decline Crop Value – USDA8-29

    Alabama: Pesticide Clean Days, Sept. 3-48-28

    Oklahoma: Fall Cotton Tour, Hydro, Sept. 118-28

    Rice Harvest Eases Into Gear In Midsouth – AgFax8-28

    Farm Drones Under Scrutiny: Farmers Impatient for FAA Ruling – DTN8-28

    USDA Readies Dairy Program, Producers Able to Sign Up Tuesday – DTN8-28

    U.S. Grain Transportation: Inspections Continue to Increase8-28

    Farm Program Decisions Hinge on Uncertain 2014 Crop Prices8-28

    Raindrops Keep Falling on Heads of Many Midwest Farmers — DTN8-28

    Economist: Big Potential in China for U.S. Corn, Livestock Exports8-28

    John Deere Lays Off 460 from Waterloo, Iowa Factory8-28

    U.S. Energy: Retail Gas Prices Follow Crude Prices Lower8-28

    Gasoline Prices: Decline by 2 Cents8-28

    Propane Stocks: Up to 74.7M Barrels8-28

    Diesel Prices: Average Drops a Penny8-28

    Sugarcane Aphid In Grain Sorghum: Florida, Georgia Find Infestations8-27

    Cotton – Midsouth – Bolls Opening, Early Defoliation Nears – AgFax8-27

    Midwest Corn and Soybeans Need Warm, Clear September – AgFax8-27

    Cotton – Southeast – More Open Bolls, Lingering Pests – AgFax8-27

    Farm Groups Map Waters to Block Clean Water Act Changes – DTN8-27

    Texas: 2 More Counties Make Natural Disaster List8-27

    Southwest May Face ‘Megadrought’ This Century, Say Scientists8-27

    China’s Citizenship Reform Should Benefit Farmers — DTN8-27

    What Can We Learn about Corn, Soybean Yields from Crop Tours?8-27

    Consider Sulfur for Your Fertility Plans This Fall — DTN8-27

    Rough Rice: Stocks Down 13 Percent from August 2013 — USDA8-27

    South Carolina: Peanut Field Day, Blackville, Sept. 48-27

    Sunbelt Ag Events

    Rice News

     

    About Us

    AgFax.Com covers agricultural trends and production topics, with an emphasis on news about cotton, rice, peanuts, corn, soybeans, wheat and tree crops, including almonds, pecans, walnuts and pistachios.

      

    This site also serves as the on-line presence of electronic crop and pest reports published by AgFax Media LLC (formerly Looking South Communications).

        

    Click here to subscribe to our free reports.

      

    We provide early warnings and confirmations about pests, diseases and other factors that influence yield. Our goal is to quickly provide farmers and crop advisors with information needed to make better and more profitable decisions.

         

    Our free weekly crop and pest advisories include:

    • AgFax Midsouth Cotton, covering cotton production and news in Alabama, Arkansas, Louisiana, Mississippi, Tennessee and Missouri.

    • AgFax Southeast Cotton, covering cotton production and news in Alabama, Florida, Georgia, North Carolina, South Carolina and Virginia.

    • AgFax Southwest Cotton (new for 2013!), covering cotton production and news in Texas, Oklahoma, Kansas and New Mexico.

    • AgFax West (formerly MiteFax: SJV Cotton), covering California cotton, alfalfa, tomatoes and other non-permanent crops in California's Central Valley.

    • AgFax Rice covering rice production and news in Arkansas, Louisiana, Mississippi, Missouri and Texas.

    • AgFax Peanuts, covering peanut production in Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, North Carolina, South Carolina, Texas and Virginia.

    • AgFax Southern Grain: covering soybeans, corn, milo and small grains in Southern states.

    • AgFax Almonds, covering almonds, pistachios, walnuts and other tree crops in California's Central Valley.

    • AgCom 101, providing guidance to ag professionals involved in social media.

    Our newsletters are sponsored by the following companies: FMC Corporation Chemtura Dow AgroSciences.

          

    Mission statement:

    Make it as easy as possible for our community of readers to find and/or receive needed information.

              

    Contact Information:

    AgFax Media. LLC

    142 Westlake Drive Brandon, MS 39047

    601-992-9488 Office 601-992-3503 Fax

    Owen Taylor Debra L. Ferguson Laurie Courtney

          

    Circulation Questions?

    Contact Laurie Courtney