Fair rent agreement.

[beaverdam]

Question,,,
What dollar value per acre, does a cash renter receive from the government's matching AgriInvest program? Suppose the gross sale value of crop is $500/ac
(I'm not in the programs, just C.I.,,, so not sure what the rate "government benefits" a renter can achieve, by just simply using a landlords property to increase their crop sales, and receive free government matching money?)

[BreadWinner]

Agriinvest is 1% of gross crop sales but capped at 1 million in sales. For $500/crop income they will give you $5 per acre if you put up the other $5 to match it. There $5 is not tax paid so when you take it out it is income.

[goalieguy847]

Agriinvest is 1% of gross crop sales but capped at 1 million in sales. For $500/crop income they will give you $5 per acre if you put up the other $5 to match it. There $5 is not tax paid so when you take it out it is income.

Yeah we generally dont touch crop share. The old values are out to lunch ( quarter crop share) as the increased cost of equipment and repair isnt factored in.
As for old hayland i recently signed a deal for 5 yrs on 1/4 of hayland. I gave him option of 1st yr free for me ( as costs to work up are roughly 80$/ ac) or 2 yrs rent free. After 5 yrs the rent can go up by maximum 20% with us getting first right of refusal. The deal holds thru regardless of if the piece is sold or not.

Old hayland is a slippery fish. If alfalfa it will sometimes be quite high in N but extremely low in P/ K and cutworms love to hang out there for the next 2-3 yrs so canola is generally a no go. The fibrous roots of a decade old haycrop can be a lifesaver in an extremely wet yr ( 3 yrs ago the only decent crops we had were on old alfalfa fields that had been worked the yr prior) as the root system helps water infilftration.
In a dry yr however you may as well shave the hayland yield in half against any other field that is continuous crop. The fibrous roots after being work can actually work against you when not enough moisture and the seed to soil contact is usually poor for smaller seeds such as canola/ mustard etc.

Its really a crapshoot that is controlled most specifically by rain... regardless of whether the hayland has been worked 10 times or seeded directly into sod. We have a crop of barley ( synergy) on some hayland we broke last yr (20 yr buffalo field) and if this barley doesnt do 110 ill eat my hat. It has had well over 12 inches of rain this yr so moisture is not our limiting factor.

In regards to term on a contract
... personally i wouldnt touch anything less than 5 yrs for any old hayfield. Its just not worth the risk with our current crop rotations and the * GENERALLY* popr crop we get for the 1st 2 years....

[goalieguy847]

As well... i have actually worked into our land rent deals that if i pay the rent on timr for the 1st 3 yrs we get the last 2 yrs at 5% decreased rent.
I find it silly that landowners ( and i do have some land i own and rent out as well) think they should get MORE money for rent as time passes. If its a good renter who pays on time and managed the field ( specifically weeds.. could care less about their fert program) then they should get a relief for being good stewards.
NO canola on canola however due to clubroot issues in all of our counties and surrounding areas.

I had a landlord tell me after 3 yrs rent would go up by 5$ an acre. I asked why... he said " inflation".

The conversation didnt go alot further.

[blackpowder]

You have some great ideas.
Demand has always been high here.
Forget about a formal lease normally.
Verbal and you have 5 seconds.
One I did have, the landowner broke it anyway. The only loyalty I ever got was not going up to the area max right away. (2.4% of market value instead of 2.5% LOL)
Having said that, I've also had some wonderful owners.
Was fired by one, (Alzheimer's)
And I fired one, (A Chuck)

[Retired]

I gather from the comments that most of you are renters of some land,whitch is good ,all comments are useful, we all have to make some money or what is the point ,and I am guessing every area is different weather affects ,area average yields, closeness to home and quality of soil ,competition for land and some things you cant realy put a $ value on. Its just nice when you both go away happy.

[Guest]

Still curious tho, would you be paying your share of some inputs ?

[blackpowder]

Still curious tho, would you be paying your share of some inputs ?

And is he recognizing his tax benefits?
And here's one. Is that percentage after trucking and drying? Net after tenant paid all trucking, drying, shrink, dockage? His 1650 flat floor bins? Enough storage?
Allowed to sell all share grain on lowest contracts or averaged? Who tracks it? Grain cart tickets too? Sweep the box corners when moving?
One guy I fired wanted full cash on breaking if I broke it LOL.
Usually son in law takes it back in year 3 for me lol. Lost some this year that way.

Thinking when it's my turn. Just a reasonable to lower for area % of land value. Then a % waiver in years where you're at or in to ins levels.
% crop share is like paying the casino a take on every pot, plus the annual buy in. Too much paid in good years not available to cover the poor. That's my experience, have #s to prove, and MNP agrees.
Supply and demand of course makes all the above buffalo chips.
Good luck to you in your retirement.
Have another landlord in terminal care now myself.

[shtferbrains]

Crop share was popular here when inputs were -$40 an acre and most farmed 1/3 summerfalliow.

Wasn't long for the higher input,continuous crop cash rents to pay better than that did.

But to crop share on todays operating costs reminds me of advice a friend gave me.
" If I'm going to go broke I don't want to work hard at it".

[blackpowder]

No book work either, if you all had permit books.