The Midwest and the Mid-South parts of the country saw farm income decline in the fourth quarter of 2018.
In spite of the pressure on farm incomes, the value of quality farmland, ranchland, and pastureland rose. Those observations come from the latest Agricultural Finance Monitor, which is published by the Federal Reserve Bank of St. Louis. The 22 agricultural banks that responded to the Fed Survey are located in seven Midwest and Mid-South states, including Arkansas, Illinois, Indiana, Kentucky, Mississippi, Missouri, and Tennessee.
Lenders continued to report declining farm incomes compared to a year earlier. The last quarter of 2018 was the 20th-straight quarter of lower farm incomes. Farm income expectations improved slightly in the first quarter of 2019.
One Missouri lender says, “We’ve heard rumors of large farmers filing for bankruptcy. Farmers in our area still have crops in the field.” The past surveys done by the Fed showed expectations of dropping farmland value.
In spite of that, quality farmland value rose 3.4 percent in the fourth quarter of last year when compared to 2017. Cash rents for quality farmland rose 2.9 percent in the fourth quarter.
Source: National Association of Farm Broadcasters