Vilsack says commodity prices are likely to remain high for at least two years, and that makes the farm economy one of the nation's bright spots.
High prices, of course, are a welcome development for farmers -- AND -- the occasional real estate agent...
Jason Henderson: Federal Bank of Kansas City, Omaha Office: 01:33:22 "I think we have a strong demand, both from food products, but also we've diversified ourselves to going beyond food for energy, to other types of industrial products. And at the same time, we have a system that we always respond to that type of demand. We're able to implement technology into increased supplies to match the emerging demand needs, not just in the United States, but on a global basis."
The increase in commodity prices has, in turn, been pushing farmland prices higher. Every U.S. state saw land values rise in 2010. That growth comes on the heels of a 2 percent drop in 2009.
Iowans saw the greatest increase with land values growing by 13 percent above a year ago. In Minnesota, an acre of ground cost 12 percent more than 2009 while Wisconsin saw a slightly lower 11 percent rise. Agricultural land in Nebraska, Kansas and Missouri also gained significantly in 2010 with an increase of 9.5 percent. Despite a banner year throughout most of the Midwest, land values in Texas and Oklahoma fell below the traditional 3 to 4 percent annual increase growing by only 2.8 and 1.5 percent respectively. Much of the slow growth in Oklahoma was based on energy demand that included natural gas which failed to see the same solid growth as other commodities.
Nonfarm investors also have begun to take a larger role in land acquisitions but farmers continue to comprise the majority of the buyers.