CHICAGO, Feb 13 (Reuters) - Farmland prices in the heart of the U.S. grain belt edged higher in the last quarter of 2013, countering some weakness in the prior quarter as farmers and investors absorbed a sharp drop in grain prices ahead of a record U.S. corn harvest, according to a quarterly report by the Federal Reserve Bank of Chicago.
“Agricultural land values rose 3 percent from the third quarter to the fourth quarter of 2013,” the Fed said, based on a survey of 186 farm bankers in the northern Midwest. “A majority of respondents anticipated farmland values to remain stable during the January through March period,” it added.
The trend was similar to results reported earlier on Thursday for the southern Midwest by the St. Louis federal Reserve. Like bankers in that region, Corn Belt bankers were facing 2014 with caution as the effect of lower grain prices and higher input costs for farmers put pressure on grain farm profit for the first time in five years.