The recovery in crop prices has slowed, but not reversed, the decline in US land prices, a leading survey showed, adding a warning that rising borrowing costs may make even this relief short-lived.
An index of US farmland prices compiled by Creighton University rebounded 2.0 points to 42.9 this month, the first rise since November.
The increase came amid some signs of recovery in the US rural economy overall, said the university, flagging the impact of the revival in crop prices from early-year lows, with Chicago soybean and wheat futures up some 15% so far in 2014, and corn up 17%.
"Recent boosts to agriculture commodity prices should boost the economy in the months ahead," said Creighton economics professor Ernie Goss, who oversees the survey.
However, farmland index remained below the 50.0 figure indicating a neutral market.
"This is the fifth straight month that the farmland and ranchland-price index has moved below growth neutral," Professor Goss said, holding out little hope of a sustained recovery.
"With the Federal Reserve continuing to withdraw its economic stimulus, I expect rising interest rates to put even more downward pressures on farmland prices and cash rents."
He was downbeat over the farm equipment market, despite some recovery, by 7.4 points to a "frail" 36.7 in the index for agricultural machinery sales.
"Agriculture equipment and implement dealers in the agriculture based areas are experiencing very weak sales," he said.
The market in Illinois, the second-ranked corn and soybean producing state, was rated the survey's weakest, with an index reading of 36.2, with South Dakota's pegged at 36.2, and Iowa an Wyoming also achieving low ratings.
Separate figures three weeks ago, from the Realtors Land Institute, showed values in Iowa, the top corn and soybean producing state, falling by 5.4% in the September-to-March period.
The decline reflected "lower commodity prices, higher input costs, increasing interest rates, government regulation uncertainty, and uncertainty of the US and world economy", the institute's Iowa chapter said.