Figuring How much Land Rent to Offer

[blackpowder]

Could be different from area to area. Used to be 33% at one time here with owner paying 1/3 of seed fert chem and ci. Most went cash here. Some are going back to a % of gross, no expenses. Most are at %25.
@ the time, on the land I had under these arrangements, I compared the two scenarios, %25 vs %33.3. They worked out very close to the same.
Having said that, the % of gross is enough hassle without keeping inputs seperate. Dont forget your %1 aginvest loss if u sell in his name.
My preference would be %20 of gross. Especially as most landowners have no bins. Of course depending on cash rates in your area!! This is with cash in our area of $80 - $115 / ac.
Any higher % takes too much in the great years, and still gives them a decent minimum in poor years. They have no ins.
All of this is moot of course as, with the price of gas, you pay the market or walk. And your competitors may have a lower fixed cost than you so can pay more.
Remember the beneficiaries who get the land will require a %5 roi including appreciation. Good luck!

[blackpowder]

Could be different from area to area. Used to be 33% at one time here with owner paying 1/3 of seed fert chem and ci. Most went cash here. Some are going back to a % of gross, no expenses. Most are at %25.
@ the time, on the land I had under these arrangements, I compared the two scenarios, %25 vs %33.3. They worked out very close to the same.
Having said that, the % of gross is enough hassle without keeping inputs seperate. Dont forget your %1 aginvest loss if u sell in his name.
My preference would be %20 of gross. Especially as most landowners have no bins. Of course depending on cash rates in your area!! This is with cash in our area of $80 - $115 / ac.
Any higher % takes too much in the great years, and still gives them a decent minimum in poor years. They have no ins.
All of this is moot of course as, with the price of gas, you pay the market or walk. And your competitors may have a lower fixed cost than you so can pay more.
Remember the beneficiaries who get the land will require a %5 roi including appreciation. Good luck!

[blackpowder]

Oops. This seems to be the only site i have this problem with.

[Flatlander]

I think it's all cash here these days. I ended my last crop share a dozen years ago. Grew 30 bu green peas got 9.50 / bu, anyway LL got $100/ acre me got $200/acre. Only trouble was all in I spent North of $200. Next spring LL suggested I seed whole farm to those green peas.

[wade]

A third crop share is from a few years back. Gave it up, couldn't afford it. Had to have a starting point for discussion. Wanted to know other operations views or ways of figuring a "pain"(paying) threshold

[sumdumguy]

I once spoke to a lady in Alberta whose renter gave her the first 8 bushels of whatever crop was grown.

[farmaholic]

TRUST!!! Crop sharing requires the Landlord to trust their tenant. I agree with Fj though. Although I don't rent any land I wouldn't want that sort of arrangement, too much of a pain in the ass.

Pay them cash, no questions asked. Easy.

p.s. if you can find the down payment then make the payments for the same or a bit more than the price of the rent, offer to buy it.

[magnum]

Useful video: https://www.fcc-fac.ca/en/ag-knowledge/production/farmland-buy-or-rent-with-merle-good.html

18-22% of last 3 years Gross Revenue