For those states comprising the Kansas City Federal District
(Nebraska, Mountain States, Kansas, Missouri and Oklahoma), the expectations
for farm income have dropped dramatically due to the drought. The district just released report on the
second quarter agricultural credit conditions.
The report presented a chart of actual income versus
expected income by quarter from 2004 to now.
This district has substantial livestock operations so the
high cost of feed is more negatively impacting farm income than perhaps other
reporting districts.
Farmland prices have increased dramatically from a year
ago. Nebraska leads the pack with a
36.5% increase in non-irrigated land, with some of the other states not too
far behind. However, expectations going
forward is for flat farmland values for the next year or so due to the
drought. Also, there is probably some
“fatigue” setting in from the rapid appreciation in values.
