Drought Crimps Farmland Values, Equipment Sales, Fed Bank Says

A drought that devastated crops in the southern Great Plains during the second quarter slowed the growth of land values, eroded agricultural income and led to fewer purchases of farm equipment, the Federal Reserve said.

While the pace of gains in cropland slowed from the first quarter, properties in a seven-state region that includes Nebraska and Oklahoma were 20 percent more expensive than a year earlier, the Federal Reserve Bank of Kansas City said today in a report on its website. Ranchland was up 11 percent from a year earlier, and farm-credit conditions remained positive even as farmers cut back spending, the bank said.