The hot farmland market continues in the Midwest with some Illinois land selling for $11,000+ per acre. A farm auction last Friday in Mason County, Illinois, drew lots of spectators and more than 50 registered bidders when 444 acres were sold in multiple tracts for a total of $4.46 million.

The most productive 364 acres of farmland sold for $4.01 million, which averages $11,016/acre.

The price paid for the land was higher than expected, reported Murray Wise, chairman of Murray Wise Associates, the firm that conducted the auction. "These prices may raise a few eyebrows, but I think they are opening some eyes, too,” he said. The strong farmland market shows both a big demand by investors as well as a desire by local farmers who want to add land to their holdings.

"To be sure, we continue to see growth in demand by portfolio managers for investment funds, but those who know the land best — local farmers — see the value better than anyone,” Wise said. “Someone who is already farming in the area can often farm the land without buying new equipment, so at today's commodity prices, it can be immensely profitable."