Agricultural real estate values continued to increase at a rapid pace across farm country through the end of last year. The increase in the value of farmland has accelerated in recent quarters alongside elevated commodity prices that have boosted profit opportunities and supported broad strength in the U.S. farm economy.
The Federal Reserve Bank of Kansas City says farm finances and credit conditions have improved dramatically in recent years and interest rates on farm loans remained near historic lows. That’s added support to agricultural real estate markets.
Looking at the year ahead, the outlook for agricultural credit conditions remains strong. Elevated commodity prices and robust support from government aid programs due to COVID-19 supported rapid improvement in farm income and credit conditions.
Despite concerns about higher input costs and intensifying drought in some regions, markets for most major commodities remained strong, and producers are looking at sound profit opportunities in 2022.
