04/14/2014 12:33 EDT | Updated 06/14/2014 05:59 EDT

Saskatchewan farmland values jumped 29% in 2013

Farmland values are increasing rapidly across Western Canada, but nowhere as fast as in Saskatchewan, a report from Farm Credit Canada says.

In 2013, Saskatchewan farmland went up in value by 28.5 per cent, a bigger jump than in any other province.

It's also the biggest increase Saskatchewan has seen in at least a decade.

It's not a one-year phenomenon. According to FCC, Saskatchewan farm values have gone up 89 per cent over the past three years.

According to FCC, Saskatchewan's hike was fueled in part by optimism in the industry: grain prices were high in the earlier part of the year, cattle prices rose later in the year, and the fall harvest was one of the biggest in history.

It said local farmers were looking to expand operations by buying land they had previously rented.

Young producers moving back to Saskatchewan were also snapping up farmland, as were out-of-province buyers.

Low interest rates were also driving up demand for farmland, the FCC said.

Meanwhile, the average value of Canadian farmland increased 22.1 per cent in 2013.

While Saskatchewan led the pack, Manitoba was second with farmland values increasing 25.6 per cent and Quebec was third with 24.7 per cent.

The FCC report didn't include dollar figures for average farm values, just the percentage increases.