The U.S. farmland boom continues.

In the first quarter of 2012, prices hit record highs, according to two Federal Reserve bank surveys released this weeks. Reuters noted that the pace of sales was strongest in the Plains but firm also in the Midwest Corn Belt.

"It's a very hot market. We've sold just over $400 million worth of land in the last seven months -- and people are still interested," Jim Farrell, CEO of Farmers National Company, the largest U.S. farm management company, based in Omaha, told Reuters.

Among the highlights in the Fed reports:

• The value of nonirrigated cropland in the Plains, which stretches across big wheat, cattle and corn states, was up 25 percent from a year ago and irrigated farmland prices jumped 32 percent. For irrigated farmland, the year-to-year percentage increase was the largest in the 30-year history of the survey. Ranchland values, rich in grazing pasture, gained 16 percent, with high feed costs boosting demand from cattle ranchers, the Kansas City Fed's survey of 235 bankers stated.
• The price of prime farmland in the heart of the Midwest Corn Belt also rose — up 19 percent in the quarter compared to a year ago. Land values in Iowa, Illinois, Indiana, Michigan and Wisconsin kept rising at the start of the year but fell "short of the torrid pace of 2011," the Chicago Fed said.
• Big ethanol states — with corn as the main feedstock — led the jump in land prices. Farmland in Nebraska rose 38.6 percent for nonirrigated acreage and 41.4 percent for irrigated. Iowa followed with farmland prices up 27 percent from a year ago.

Reuters noted that land auctioneers report that the price of top farmland across the Plains and into the Midwest soared to as high as $14,000 - $15,000 an acre, up from $8,000 to $10,000 in 2011. Just 10 years ago similar top-dollar land in the top corn state of Iowa sold for about $1,900 an acre.

The Fed has been tracking the boom in farmland values for several years now. And once again, the concern bubbled up about a bubble — which Harvest Public Media explored more than a year ago , when this this dramatic trend was just getting started. From the Reuters story:

Some bankers have worried about the possibility of a farmland bubble like the one seen in the 1980s, when over-extended farmers lost their land as interest rates jumped. But booming grain demand in recent years has transformed the debt posture of many farmers, analysts say.

Jason Henderson, chief ag economist for the Kansas City Fed, said farmers are in much better shape than in the 1980s.

"The worry about farmland values is always in the background especially with some of the forecasts that crop prices are going to average below $5 per bushel for corn this year. That means it's going to squeeze margins," he added.

Both Fed banks, however, said credit conditions for farmers and agricultural banks continued to sparkle. Cash flows allowed grain farmers to retire debt even as capital spending on equipment and buildings expanded. Farm asset values rose and loan demand shrank again as many farmers paid bills with cash.

Bankers across both districts did not expect the farmland market to cool any time soon. Roughly two-thirds of the reporting bankers anticipated agricultural land values to hold near peak levels while a third expected further increases, according to the surveys by both banks.

Click here to read the Reuters summary of the reports.