A little while back I posted about a Land Lease program, "Farmland Leases: Finding Balance in Farmland Lease Contracts." If you couldn't make the September 9 program held in Logansport, this will be held again on Thursday, December 5 in Danville, Indiana.
I attended the September program and it had very good coverage of basic principles. For additional information, see this Ag Answers Story.
Showing posts with label Cash rent. Show all posts
Showing posts with label Cash rent. Show all posts
Tuesday, November 19, 2013
Wednesday, September 4, 2013
Land Lease Program
The Purdue Land Lease Team will be sponsoring a program, "Farm Land Leases: Finding Balance in Farmland Lease Contracts" on Friday, September 13 from 9 a.m. to Noon at the Ivy Tech in Logansport. I've attached a link to the program flyer below.
To register for the program contact Howard County Extension Educator Paul Marcellino at 765-456-2313 or you can e-mail him at pmarcell@purdue.edu. There is no cost for the program.
Farm Land Lease Program Flyer
To register for the program contact Howard County Extension Educator Paul Marcellino at 765-456-2313 or you can e-mail him at pmarcell@purdue.edu. There is no cost for the program.
Thursday, August 29, 2013
2013 Purdue Cash Rent and Land Values Survey Results
This is sort of an "oops" post. I sent an e-mail to my mailing list when this came out a couple of weeks ago but neglected to post anything here.
The results of the 2013 Purdue Cash Rent and Land Values survey have been published at the following link:
Purdue Cash Rent and Land Values Survey
As a quick guide for Clinton County, Indiana landowners and tenants, the land values are on table 1, cash rents are on table 2 and Clinton County is in the central region of the state.
The results of the 2013 Purdue Cash Rent and Land Values survey have been published at the following link:
As a quick guide for Clinton County, Indiana landowners and tenants, the land values are on table 1, cash rents are on table 2 and Clinton County is in the central region of the state.
Friday, August 10, 2012
August 29 Farmland Rental Program
The Clinton County Extension Service will be hosting a Farmland Rental Program on Wednesday, August 29 from 10:30 a.m. to 12:45 p.m. at the Clinton County Fairgrounds, 1701 South Jackson Street in Frankfort.
Purdue Ag Economist Craig Dobbins will be on hand to discuss the recently released 2012 Indiana Land Values and Cash Rent Survey Results. He will consider the results of this survey, implications for rental rates in 2013 and discuss various aspects of rents such as negotiating contracts and flexible cash rents.
This looks to be a very good, useful program, particularly considering how this abnormal crop year may influence land decisions, particularly rental contracts.
A lunch, sponsored by The Farmers Bank, will be provided. Pre-registration is required if you intend to eat with us. Please register by August 22 by calling the Clinton County Extension Office at 765-659-6380 or 296-3511 or you may e-mail me at cemanuel@purdue.edu. If you don't pre-register you may still attend but lunch is not guaranteed.
For additional information and a registration form you may download the program flyer from the link below:
Farmland Rental Program Flyer.
Purdue Ag Economist Craig Dobbins will be on hand to discuss the recently released 2012 Indiana Land Values and Cash Rent Survey Results. He will consider the results of this survey, implications for rental rates in 2013 and discuss various aspects of rents such as negotiating contracts and flexible cash rents.
This looks to be a very good, useful program, particularly considering how this abnormal crop year may influence land decisions, particularly rental contracts.
A lunch, sponsored by The Farmers Bank, will be provided. Pre-registration is required if you intend to eat with us. Please register by August 22 by calling the Clinton County Extension Office at 765-659-6380 or 296-3511 or you may e-mail me at cemanuel@purdue.edu. If you don't pre-register you may still attend but lunch is not guaranteed.
For additional information and a registration form you may download the program flyer from the link below:
Farmland Rental Program Flyer.
Tuesday, May 22, 2012
August Dates to Save
I have a couple of programs I've scheduled for August so I'll throw these in here as a "save the date" message. More details will follow as we get closer.
On Tuesday, August 14 I'll have a Pork Quality Assurance (PQA) Plus and Site Self-Assessment Training program. This will be held at the Clinton County Extension Office, 1111 South Jackson Street in Frankfort from 6:30-8:30 p.m. The first hour will cover PQA Plus, the second hour will be for the site self-assessment training and test. Keep in mind if you know of someone who will be going to college to work in a swine unit or if you have a youth member age 14 or older who markets 10 or more pigs, they will probably need PQA Plus certification.
I've scheduled two programs for Wednesday, August 29 at the Clinton County Fairgrounds. In the morning from 10:30 to Noon, Craig Dobbins from the Purdue Ag Economics Department will be on hand to discuss Indiana Land Values and Cash Rents, including information based on the 2012 Indiana Land Values and Cash Rents Survey results, which should be available by this meeting. From 1-3 p.m. we'll have a Private Applicator Recertification Program (PARP). I don't know the precise topic for this but Fred Whitford from Purdue Pesticide Programs will be the main presenter so I'm sure it will be good.I'm working on finding a lunch sponsor for this day so hopefully we'll have a meal for attendees. EDIT: Just received a call from The Farmers Bank and they will be sponsoring lunch for the day.
On Tuesday, August 14 I'll have a Pork Quality Assurance (PQA) Plus and Site Self-Assessment Training program. This will be held at the Clinton County Extension Office, 1111 South Jackson Street in Frankfort from 6:30-8:30 p.m. The first hour will cover PQA Plus, the second hour will be for the site self-assessment training and test. Keep in mind if you know of someone who will be going to college to work in a swine unit or if you have a youth member age 14 or older who markets 10 or more pigs, they will probably need PQA Plus certification.
I've scheduled two programs for Wednesday, August 29 at the Clinton County Fairgrounds. In the morning from 10:30 to Noon, Craig Dobbins from the Purdue Ag Economics Department will be on hand to discuss Indiana Land Values and Cash Rents, including information based on the 2012 Indiana Land Values and Cash Rents Survey results, which should be available by this meeting. From 1-3 p.m. we'll have a Private Applicator Recertification Program (PARP). I don't know the precise topic for this but Fred Whitford from Purdue Pesticide Programs will be the main presenter so I'm sure it will be good.
Monday, December 12, 2011
More Flex-Lease Information
Iowa State Extension has (or at least seems to) been among the first to do in-depth work on Flexible Cash Leases. A blog reader sent this link to a webinar Steve Johnson from Iowa State did on this.
Iowa State Flexible Lease Webinar
Consider this a supplement to my first Flexible Lease post.
Iowa State Flexible Lease Webinar
Consider this a supplement to my first Flexible Lease post.
Sunday, November 13, 2011
Flexible Cash Rents
I am not a farm rental contract guru by any means. However over the past couple of weeks I've received several calls requesting what is an appropriate cash rent level in Clinton County. Obviously this depends on several factors which I'm not going to cover here. Instead, I want to talk a little bit about, or at least offer some resources on, flexible cash rents.
Among the calls I've been getting has been one which generally asks, "How do I put a rent together which lets both me and the farmer take advantage of really good years?" My response has been to take a look at a flexible contract. Flexible contracts set a floor or base rent for cropland with the landowner capturing a certain amount of income above a set level.
As an example, a landowner and farmer may set a base rent of $200/acre based on 200 bushels of $5 corn (I'm using these figures because it makes the math easy) or a gross revenue of $1000/acre.
If corn price is $6 and yield is 200 bushels, then the gross is $1200 and in a flexible rent system the landowner would receive a certain percentage of the $200 overage. The same type of overage might apply with a very good yield - say, 220 bushels at $5.
These systems are pretty simple in concept but because of the uncertainties they can be pretty complicated in practice. A key point is, How do you set the price? Is it a)local cash price twice a year b)averaged on a certain day of each month through the year, or c)some other way? From a farmer's perspective this type of rental agreement fails to take input costs into account. Crop prices may look very good but input costs have this pesky habit of rising when prices are good so this isn't the entire story. Also, if you want to share in the potential upward benefit, you should be prepared to share in some of the downward risk as well.
I'll also caution landowners that a 50-50 split of the overage isn't appropriate (at least that I can see). Keep in mind that for every additional bushel of grain harvested, the farmer has some costs associated with it. That bushel must run through the combine and be hauled to the elevator. For corn it will usually need to be dried and, in theory at least, each additional bushel will require additional fertilizer.
Rather than summarize what people more experienced and informed than I have to say about this, I'm going to refer you to an online resource (initially I was going to include links to Ohio State, Illinois and Iowa State but those are on this page).
Purdue's Farmland Leasing Page - This page has a variety of land rental resources including a link to the cash rent and land values survey. Toward the bottom of the first section are a couple of Purdue resources including a flex rent calculator. If you move further down the page under "Flexible Cash Rent Leases" you'll find information from other Universities.
Flexible rents can be a useful way of allowing landowners and farmers to share in profitable years. I do caution people to remember that to date, these agreements do not typically account for variations in input costs, something which will have a tremendous impact on profitability. Hopefully in the future this type of adjustment may also start being factored into agreements.
Among the calls I've been getting has been one which generally asks, "How do I put a rent together which lets both me and the farmer take advantage of really good years?" My response has been to take a look at a flexible contract. Flexible contracts set a floor or base rent for cropland with the landowner capturing a certain amount of income above a set level.
As an example, a landowner and farmer may set a base rent of $200/acre based on 200 bushels of $5 corn (I'm using these figures because it makes the math easy) or a gross revenue of $1000/acre.
If corn price is $6 and yield is 200 bushels, then the gross is $1200 and in a flexible rent system the landowner would receive a certain percentage of the $200 overage. The same type of overage might apply with a very good yield - say, 220 bushels at $5.
These systems are pretty simple in concept but because of the uncertainties they can be pretty complicated in practice. A key point is, How do you set the price? Is it a)local cash price twice a year b)averaged on a certain day of each month through the year, or c)some other way? From a farmer's perspective this type of rental agreement fails to take input costs into account. Crop prices may look very good but input costs have this pesky habit of rising when prices are good so this isn't the entire story. Also, if you want to share in the potential upward benefit, you should be prepared to share in some of the downward risk as well.
I'll also caution landowners that a 50-50 split of the overage isn't appropriate (at least that I can see). Keep in mind that for every additional bushel of grain harvested, the farmer has some costs associated with it. That bushel must run through the combine and be hauled to the elevator. For corn it will usually need to be dried and, in theory at least, each additional bushel will require additional fertilizer.
Rather than summarize what people more experienced and informed than I have to say about this, I'm going to refer you to an online resource (initially I was going to include links to Ohio State, Illinois and Iowa State but those are on this page).
Purdue's Farmland Leasing Page - This page has a variety of land rental resources including a link to the cash rent and land values survey. Toward the bottom of the first section are a couple of Purdue resources including a flex rent calculator. If you move further down the page under "Flexible Cash Rent Leases" you'll find information from other Universities.
Flexible rents can be a useful way of allowing landowners and farmers to share in profitable years. I do caution people to remember that to date, these agreements do not typically account for variations in input costs, something which will have a tremendous impact on profitability. Hopefully in the future this type of adjustment may also start being factored into agreements.
Monday, August 22, 2011
Indiana Farmland Values and Cash Rents on the Rise
The 2011 Purdue Farmland Values and Cash Rent Survey results are in. Land values and rents are both up significantly over 2010 survey numbers. You can read the survey results in the August, 2011 Purdue Agricultural Economics Report. You will need Adobe Reader for this document.
Keep in mind that Clinton County is considered part of the Central District in Indiana. Tables 1 and 2 are what people are generally most interested in but there's a fair amount of information if you have a chance to read the entire report.
Keep in mind that Clinton County is considered part of the Central District in Indiana. Tables 1 and 2 are what people are generally most interested in but there's a fair amount of information if you have a chance to read the entire report.
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