State Farmland Values Dip 0.9% in 3rd Quarter

Article excerpt

Journal Record Staff Reporter

Oklahoma farmland values decreased 0.9 percent to an average $440 per acre in the third quarter of 1992 from $444 per acre in third quarter of 1991, according to the Federal Reserve Bank of Kansas City.

The third quarter average represented a drop of 1.1 percent from $445 per acre in the second quarter of 1992.

Reported in the Regional Economic Digest, farmland values were calculated from a survey of 327 bankers in the 10th Federal Reserve District, which includes Oklahoma, Kansas, Missouri, Nebraska and Colorado, New Mexico and Wyoming combined as the mountain states.

Average farmland value in the 10th District during the third quarter was $562 per acre, 2.36 percent above $549 per acre during the third quarter of 1992. The average value equaled $562 per acre in the second quarter.

In Oklahoma, non-irrigated farmland increased 1.6 percent in the third quarter to $445 per acre from $438 per acre in third quarter 1991. Irrigated farmland fell 4 percent to $598 per acre from $623 per acre in the same period of 1991. An increase of 2.5 percent in ranchland put the value at $278 per acre from $271.

Ranchland remained the only category in which Oklahoma's per-acre value exceeded the 10th District average.

Across the district in the third quarter, the average value of non-irrigated farmland was up 1.9 percent to $529 from $519 in the same period of 1991. Irrigated farmland increased 2.4 percent to $920 per acre from $898. Ranchland was up 2.6 percent to $237 per acre from $231.

According to the report, there was a dip in farm interest rates and an upswing in repayment rates on farm loans, which marked a slight improvement in the district farm economy. Improvement was limited due to weak farm commodity prices, it said.

"Most financial indicators reflect slight improvement in the district farm economy in the third quarter," according to the report written by Alan Barkema, senior economist with the Federal Reserve, and Corey Waldinger, a research associate.

"Farmland values edged up, farm interest rates continued to fall and repayment rates on farm loans improved. Meanwhile, weak grain prices are constraining incomes for crop producers while boosting profits for livestock producers," the report said. …