Farmland prices across the Midwest held steady in the second quarter of 2026, showing no change from the previous three months or from a year earlier, according to agricultural lenders surveyed for the Chicago Federal Reserve Bank's AgLetter published in August. The flat readings mark a shift from recent quarters when prices were climbing, suggesting that land values in the five-state region may be reaching a plateau after sustained increases driven by demand from solar developers and data center projects.
Quarter-to-quarter farmland values remained unchanged across the District, which includes Illinois, Indiana, Iowa, Michigan, and Wisconsin, with state-level results balancing each other out. Wisconsin saw a slight uptick in quarterly prices, but the gain wasn't large enough to move the overall needle. Year-over-year comparisons showed Wisconsin and Indiana both dipped a bit, while Illinois and Iowa posted modest gains, leaving the District-wide figure at zero percent change in both timeframes. Credit conditions continued to deteriorate compared to a year ago, with loan demand rising while funds availability and repayment rates fell. The share of farm loans facing major or severe repayment problems climbed to 3.7% from 2.9% a year earlier, though that figure remains well below the 15% peak seen during the 1980s farm crisis.
David Oppedahl, the publication's lead author and a farm economy specialist with the Chicago Fed, noted that the flat farmland values suggest "we may be having a period where there's the beginning of a plateau." One Wisconsin lender surveyed for the report predicted that "at some point, farmland values should plateau as outside pressure from solar and data centers subsides." The report also found that Seventh District farm incomes may improve slightly from last year, bolstered by higher crop prices and positive livestock returns, though the gains won't be dramatic.
The emerging plateau in land prices follows years of upward pressure from alternative energy projects and data center development seeking rural acreage, demand that appears to be tapering off. Meanwhile, credit conditions have eroded steadily since the income surge farmers enjoyed in 2020–21, with weaker farm earnings in recent years chipping away at repayment capacity. Despite flooding in the eastern Corn Belt and early moisture shortages in the west, USDA estimates suggest Iowa could harvest a record corn yield this year, with Illinois also posting high numbers, potentially making this the District's second-best corn crop in history and possibly the best soybean crop ever. That bumper harvest could improve the farm income picture, which looks more promising now than it did six months ago, though global forces continue to pressure input costs.
Looking ahead, the lenders surveyed expect farmland values to remain flat in the third quarter of 2026. Demand for operating loans is expected to stay strong, but lending for farm machinery, grain storage, construction, and real estate is projected to decline. The Chicago Fed's Midwest Agriculture Conference on October 16 will tackle the harvest decision-making process under the theme "Bumper Harvests, Big Questions. Where Do Midwest Crops Go?" examining whether farmers should store or sell their crops, where to market them, and what price signals they're receiving. It's a mixed outlook, but as Oppedahl put it, it could be worse.