Farmland values were up across the Midwest region — including Indiana and Michigan, according to a February report from the Federal Reserve Bank of Chicago.

With the Hoosier state seeing a rise of 16 percent in 2007, Indiana matched the highest spike in the region in nearly 30 years.

At 18 percent, Iowa saw the highest boost in the value of "good" agricultural land in the Seventh Federal Reserve District, which also includes four states bordering Lake Michigan. Illinois and Michigan saw gains of 15 percent on the year.

Wisconsin farm prices saw an 11 percent annual increase, the report said.

Higher farm incomes — in part, because of high soybean and corn prices — helped to boost values.

The demand for ethanol is fueling the 2007-2008 record projection for corn usage, the report said. For that reason, farmland values are expected to continue rising through the first quarter of 2008.

But that improvement also leads to higher food prices, as consumer prices for food have risen five percent from a year ago and seven percent from two years ago.

"The agricultural sector contrasted sharply with the downturn in residential real estate and construction," said the report's author, business economist David Oppedahl.

On the farm, 55 percent in the region said they expect more spending on land purchases and improvements.