Farmland values jumped 25 percent in the third quarter of this year, a survey made by the Federal Reserve Bank of Kansas City showed. The survey gathered data from 243 banks in Kansas, Nebraska, Oklahoma, Wyoming, Colorado, northern New Mexico and western Missouri. The spectacular increase in value is based on actual sales and purchases, not estimates or projections.
With the rest of the national economy still struggling to climb out of the recession, this news makes the middle of America shine bright.
The bankers said land prices rose so sharply because of high commodity prices and bumper crops. These economic fundamentals can be expected to change. Kansas farmers had a great crop year coming until it stopped raining this summer. Only those who could irrigate enjoyed a bumper crop of corn, milo or soybeans. But last year’s production did nothing to push prices down and there are good reasons to believe that grain and livestock prices will stay in the profit-producing range.
Kansas and the rest of the Plains states — the breadbasket states — should enjoy a new and lasting level of prosperity as a consequence. The world’s population has reached 7 billion and continues to grow. Each of those 7 billion has bellies to fill.
That’s not only good news for those who make their livings from the soil, but also for the much larger number who process and market food products.
Kansas farmers do a superlative job of producing grains and livestock. But we’ve left much of the processing and marketing — where most of the wealth is created — to others. That’s where opportunity lies. That’s where our universities and state agencies should focus their wit and energy.
— Emerson Lynn, jr.
