AgLetter: May 2006

Increases slowed in the second quarter of 2006 for the value of “good” agricultural land in the Seventh Federal Reserve District, while credit conditions generally declined. From April 1, 2006, to June 30, 2006, farmland values rose 1 percent, on average, for the District, based on a survey of 235 agricultural bankers. The year-over-year increase as of July 1 was 9 percent, below the annual increase for the second quarter of 2005. Almost three-quarters of the responding bankers expected farmland values to be unchanged in the third quarter, although 21 percent thought more increases are forthcoming.