CHICAGO, May 14 (Reuters) - Prices for prime farmland in the central Corn Belt states of the U.S. Midwest held steady in the first quarter with those of a year earlier and firmed from weakness in the fourth quarter of 2014, the Federal Reserve Bank of Chicago said in its survey of farm bankers on Thursday.
"Just over half of the responding bankers expected farmland values to be stable during the second quarter of 2015, but nearly all of the rest expected farmland values to head lower," the bank said.
Earlier on Thursday, Fed bank surveys from the Kansas City and St. Louis districts indicated declines in prime farmland values year on year, the first annual drops since corn and soybean prices retreated from record highs set in 2012.
The Chicago Fed noted an 8 percent drop in cash farmland rental rates in the first quarter, compared with a year earlier, reflecting expectations for sharp drop in grain farmer incomes from levels of recent years. (Reporting by Christine Stebbins; Editing by Peter Galloway)