I wish I had a Ford dealership in the Palouse area of Eastern Washington and Idaho the next few months. Wheat prices have roughly doubled the past few months. Land prices are going up. Growers inevitably feel flush. Note these graphs from the Financial Times, April 13, 2011, Page 22
Land prices in fertile heartland states have been climbing at a stunning pace as record or near-record prices for corn, soyabeans and wheat translate into more profit per acre. Farmers, flush with cash, are bidding loudest at frenzied auctions, but institutional investors from pension funds to wealthy foreigners are increasingly part of the scene.
“It’s absolutely exploding. The land market is so tight that the difficulty right now is just finding properties for the large number of buyers out there,” says Jeff Waddell, president of Martin, Goodrich and Waddell, a farm manager and land broker outside Chicago. “Those buyers are everything from farmers in Illinois to investors from Argentina.”
The reference is to the Midwest, what coast snobs call “flyover country,” as the FT puts it. In the Pacific Northwest, it is easy to overlook the fact that Montana and Washington are among the nation’s principal wheat producers.