ST. PAUL, Minn. (AP) — Minnesota farmland prices are maintaining their sharp rise, and officials with the Federal Reserve Bank of Minneapolis say the higher prices reflect the strong agricultural economy.

A recent Fed survey of bankers in its five-state area shows that farmers are bidding land prices to new highs, in some cases over $10,000 an acre. While some experts fear land prices could be the next real estate bubble, there’s no sign of a downturn so far.

Fed officials say Minnesota farmland prices at the end of September were about 28 percent higher than a year earlier. Other Midwest states are seeing similar increases.

Joe Mahon, an economist for the Minneapolis Fed, tells Minnesota Public Radio the bankers surveyed attribute the sharp increases to high profits from strong commodity and livestock prices.

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  1. Ordinary Guy says:

    I think that Farm Aid was started after the last farmland bubble burst and many farmers who took out equity loans on equipment lost it all. A gradual yearly shift away from corn ethanol subsidies is due. Shift it to other, better energy crops with better energy gain and without all of the expenses. Energy agriculture is big for Minnesota, but those producers won’t convert unless they have to.