Tag Archives: survey
Fed Survey Confirms Farmland Plateau
Jeff Caldwell 11/14/2013 @ 3:39pmMultimedia Editor for Agriculture.com and Successful Farming magazine. Though the numbers show a year-over-year double-digit gain in farmland values as of October in the bulk of the Corn Belt, that trend effectively ended at the start of the third quarter, adding evidence to growing sentiment about the reality of a leveling-off and possible downturn in farmland values in the coming months. Farmland was worth 14% this October than it was the same time a year ago, though all but 1% of that gain came in the first 3/4 of the year. The trend definitely leveled off, according to data released by the Federal Reserve Bank of Chicago this week. That’s in line with other recent outlooks that paint a less bullish picture of the Midwest farmland market in the months ahead. “There was a 1% increase in ‘good’ agricultural land values in the third quarter relative to the second quarter of 2013, according to the 195 agricultural bankers that provided responses for the October 1 survey,” according to a report by Fed senior business economist David Oppendahl. “While district farmland values increased on the whole in the third quarter of 2013, this upward trend was not expected to continue: The respondents’ expectations leaned toward a decrease in farmland values in the fourth quarter of 2013, as only 4% anticipated an increase and 21% forecasted a decrease (75% foresaw stable farmland values).” The reversal in land value looks sustainable in the next few months, Fed economists say. That’s mostly because of grain prices. This fall’s corn and soybean crops, despite abnormally dry conditions during much fo the growing season, were larger than most expectations, and that’s fueled lower prices. And, with prices already flirting with breakeven levels, land prices — a critical input cost for Corn Belt crops — will likely continue to trickle lower to keep prices within at least a range of breakeven. “For the 5 District states (Iowa, Wisconsin, Illinois, Indiana and Michigan), soybean production was projected by the USDA to rise 8.5% in 2013 from its 2012 level. Even with the reoccurrence of drought in parts of the District, the third-largest corn harvest and a soybean harvest just outside the top 10 filled storage bins across the Midwest,” Oppendahl says. “Better-than-expected crop yields for the District may have contributed to the momentum of its rising farmland values; however, in areas affected by back-to-back droughts, the loss of revenue from declines in crop prices and yields may have constrained farmland value gains.” http://www.agriculture.com/videos/ Continue reading
Cima Green, Augsburg Energy Survey US Biodiesel Industry
Taylor Scott International News Taylor Scott International Taylor Scott International, Taylor Scott Continue reading
Survey: Farmland Values Continued To Rise In Second Quarter 2013
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. August 15, 2013 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 Mid-South 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% from an average $5,111 in the first quarter of 2013 and up more than 20% 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% from $2,274 per acre in the first quarter 2013 and up close to 1% 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 quality farmland and ranch or pastureland values to increase 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% from an average $171 per acre in the first quarter 2013 and up 12.9% 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,” might 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. Continue reading
