Farmland values surge on growing farm income

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Indiana farmland values skyrocketed to record levels last year, according to the most recent survey of agricultural lenders by the Federal Reserve Bank of Chicago.

Prices in the northern two-thirds of the state shot up 6 percent in the fourth quarter and 16 percent in 2007. Southern Indiana was not included in the survey because the region is not in its district.

The Fed does not disclose prices.

The 16-percent increase across both the northern two-thirds of Indiana and the entire district was the largest in nearly three decades, the Fed pointed out.

Driving the surge was a boom in farm income. Ethanol plants snapped up millions of bushels of corn, which drove up the price of corn as well as soybeans and other grain.

The 265 bankers responding to the survey expected farmland prices to continue climbing.

In addition to Indiana, the Fed district includes Iowa and most of Illinois, Michigan and Wisconsin.

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