Crop Share vs Cash Rent

[AlbertaFarmer5]

Are any of these landlords also offering any type of adjustments if crop prices return to where they were? Or these costs are locked in for the foreseeable future?

Seeing these numbers, and the cutthroat competition, makes me realize it is well worthwhile starving all these years to afford to own most of the land we farm.

I took the preemptive measure of renegotiating rent with one landlord who does her homework. Hadn't changed since we started renting in 2018. Will use that rate to adjust the others to match. No adversarial relationships to deal with.

[blackpowder]

Relationships aren't necessarily adversarial. You pay the highest they hear in the coffee shops or you don't farm. Their phone is ringing. Not all tho.

[red rider]

Relationships aren't necessarily adversarial. You pay the highest they hear in the coffee shops or you don't farm. Their phone is ringing. Not all tho.

also not adversarial. I'm assuming our landlord was fishing and probably surprised when I told her the actual range of rents in the area so she lowered expectations. it is still higher than what we would have paid for that land, but her land joins the other neighbor up so he can expand his fields without extra moves and it is worth it to him. Also he is younger and full of energy yet. We farmed it because we kind of went by it on our way to other fields.

[jazz]

Your renter takes off the crop with 12 new combines and you dont expect the landlord to get a little curious.

[SASKFARMER]

Land Rent in our area is going from $150.00 an acre and down. Lots of three-year contracts are up or going to be and what the landlords do is easy people will have to pay more or will lose out to others.

Land companies are saying the price is going up.

Chinees investors are saying rent is going up.

So basically from what I'm hearing all rent is going up.

Farmers from 15000 acres and down are starting to say **** it we are happy where we are farming with equipment and manpower and were shifting to neutral and just riding out the storm. Others are desperate and need to increase and increase are looking for dirt.

Who is right and who is wrong but it's starting to look like 1981 all over again.

[Rareearth]

$800,000 per 1/4 section/160 acres = $5,000 acre

At 3% rent or return on investment = $24,000 year
Or
$150 acre rent

Comparing anything to 1981 values isn't a good way to analyze or make a business decision, its a completely different world.

[Sheepwheat]

It’s way worse than 1981 IMO.

[TOM4CWB]

It’s way worse than 1981 IMO.

I have neighbours who lost their farms in the early 1980's...

Some big time operators... could be at risk... but as we learned in our farm management classes... risk management and frugal economics... if their total farm debt load is below 40% of asset evaluation... are unlikely to fail without a catastrophic event causing the farm failure.

It will be revealing to see what happens to farm operating lines of credit... over the next couple of years...

Blessings and Salutations

[ajl]

Was a quarter sold last year near some stuff I farm. This is marginal land. Land was advertised on Kijiji for 2 months early last spring. Was in reasonable condition for solenetz back in spring as previous owner farmed. Around the May long ad disappears. Well summer comes and land grows weeds so no renter found that was willing to pay the price. Mid summer sign appears: 107 acres for rent and phone number. Later in summer weeds turn yellow so may be due to no rain in area or it was sprayed. Sprayer tracks not obvious from road in areas that are visible. Somebody did cut and bale weeds in fall. Fair bit of volunteer canola was in the weed mix. My crop on land nearby was biggest disappointment of 2022. Money earns 5.5% risk free. Gicwealth.ca

[TOM4CWB]

Timing is everything...

Bad tempered landlords... can become very expensive legal bills...

Better a little with peace and quiet... than much with contention and strife...

Making a mountain out of a molehill...reveals secret weakness better forgotten...

Better eating humble pie with friends... than boasting to an empty table...

[SASKFARMER]

Tom what’s a opp line?

Seriously.

[makar]

It’s way worse than 1981 IMO.

I dont think you lived through 1981, i did and still have nightmares.

[TOM4CWB]

Tom what’s a opp line?

Seriously.

What is a second house in Florida?

Blessings and Salutations

[sumdumguy]

I dont think you lived through 1981, i did and still have nightmares.

Me too, 23% interest and an operating loan where the bank kept making “errors”. You know like in monopoly, “ Bank Error Not In Your Favour”. Bank gave nice fat refund after they were informed of their calculation errors. The whole genre made us miss a lot of sleep, drought didn’t help, only lentils helped numb the pain.

[Rareearth]

The 80’s were 40 years ago.

It was the last timethey stood together, somewhat organized, there were even protests, a crow, etc