US farmland prices extend decline to two full years
Farmland prices in major US agricultural states extended their decline to two full years, undermined by weak crop values which have kept the farm equipment sector in the mire for even longer.
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A farmland price index formulated by Creighton University, on states from North Dakota to Colorado, came in at 34.8 points for November – up from the figure of 31.0 for last month, but remaining well below the 50.0 level which indicates a neutral market.
The decline represented "the 24th straight month the index has moved below growth neutral", said Ernie Goss, the Creighton economics professor in charge of the survey, underlining the depressant effect to agriculture from weaker crop values.
"The strengthening US dollar and global economic weakness have pushed farm commodity prices down by 14.1% over the past 12 months."...MORE
'Strongly positive'The comments come the week after data from the Federal Reserve, the US central bank, showed a stabilisation in land values in major Corn Belt and central Plains states over the summer, although lenders surveyed for the report forecast a further decline in values ahead.
And they follow too an unusually large land purchase in Illinois announced last week by Farmland Partners, which purchased 22,300 acres for a price of $197m, equivalent to some $8,800 per acre, saying that it believed the sluggish market would prove short-term....
