My one and only land rent experience is $per acre. The guy i met with last night wants to do it on 1/3's. I pulled some dirt for a soil sample and told him i would be touch. Well this morning i started doing a little math. on my little 10acre patch of corn i grossed $5514.41, my costs were $2673.07 If his 1/3 comes out of the gross that leaves me $1021.59, or if his 1/3 comes out of my net that leaves me $1903.70. In my opinion neither is that hot of a deal. Am i missing something, does the land lord pay a 1/3 of the fert? or did I just get spoiled with $40 per acre cash rent. How does the 1/3 deal work in other areas. Just so you know this is 100bu ground in SE Ky. Thanks in advance.
- Thread starter G.Fields
- Start date
Sean Feeney
Well-known Member
www.extension.iastate.edu/agdm/wholefarm/pdf/c2-22.pdf
That's what it always used to be around here,but with inputs so high,I wouldn't want to do it anymore. Like you,$40 an acre is the most I pay for anything.
Last time I had anybody ask for 1/3,it was a doctor who bought a place that I'd been working for quite a while. He said his tax preparer told him that if he share rented,he could file a 1040F and depreciate the barn and what not. I told him if he wanted to share rent he could find somebody else to rent it. He didn't.
Last time I had anybody ask for 1/3,it was a doctor who bought a place that I'd been working for quite a while. He said his tax preparer told him that if he share rented,he could file a 1040F and depreciate the barn and what not. I told him if he wanted to share rent he could find somebody else to rent it. He didn't.
tomstractorsandtoys1
Member
Forty dollar an acre sure must be nice. Here in the midwest $250-350 per acre.We can grow 200 bu corn and 60 bu beans.With our extra fertlizer,rent and harvest cost you can make alot more per acre than us with less risk.A poor year or crop failure will put some of my neighbors in trouble even with crop insurance.
jim johnson
Well-known Member
They pay 1/3rd of the cost of everything but working the ground and the planting. My trouble when I was renting was them paying when planted, I had to carry them sometimes till harvest even though they had lots more money than I had. Got cheated in the end when some decided not to pay at all. Always had trouble with the folks that had the most money, guess that's why they had it, one was an ex governor of the state.
Jim
Jim
Straw Boss
Well-known Member
In my area, the landlord gets the first third for supplying the land.
You get the second third for supplying the seed, machinery and fuel.
You get the third third for doing all the work and supplying any hired labor.
Landlord pays for 1/3 of all fertilizer and chemical inputs and buys his own crop ins for his share of the crop.
There are no set rules. Just what two people can agree on.
You get the second third for supplying the seed, machinery and fuel.
You get the third third for doing all the work and supplying any hired labor.
Landlord pays for 1/3 of all fertilizer and chemical inputs and buys his own crop ins for his share of the crop.
There are no set rules. Just what two people can agree on.
Straw Boss
Well-known Member
Forgot to add the landlord gets billed directly from the co-op for the chem and fert so no worry about being hung for his share of the bills.
Share cropped grain gets hauled directly to the elevator and they do the split so landlod doesn't worry about how many loads of grain went to the elevator vs the grain bin at the farm.
He can then market his grain any way he wants whenever he wants. Most just take a check the day its hauled in regardless the price.
Share cropped grain gets hauled directly to the elevator and they do the split so landlod doesn't worry about how many loads of grain went to the elevator vs the grain bin at the farm.
He can then market his grain any way he wants whenever he wants. Most just take a check the day its hauled in regardless the price.
Wow. $40 an acre rent. Haven't seen that maybe n my lifetime. You fellas are getting a sweet deal at $40 in $5 corn and $10 corn! Need to add a 2 in front of that to rent ground anymore here.
Crop share died back in the '70s around here, was 40-60 usually, landlord got 40%. Think Social Security rules back then killed off crop share around here. Landlord paid 40% of fert and herbicide - not application, renter paid everything else. Well, landlord paid transportation of his share. But often times landlord got that too as a bonus....
--->Paul
Crop share died back in the '70s around here, was 40-60 usually, landlord got 40%. Think Social Security rules back then killed off crop share around here. Landlord paid 40% of fert and herbicide - not application, renter paid everything else. Well, landlord paid transportation of his share. But often times landlord got that too as a bonus....
--->Paul
At that price around here,it'd better have a center pivot on it with the owner paying to pump the water.
Some of the analysts on the TV say that with those super high rents,production costs come in at around $850 and acre to grow corn. The price doesn't have to dip very low with an isolated weather event to loose a WHOLE bunch of money in a big hurry at that rate.
Some of the analysts on the TV say that with those super high rents,production costs come in at around $850 and acre to grow corn. The price doesn't have to dip very low with an isolated weather event to loose a WHOLE bunch of money in a big hurry at that rate.
Allis Chalmers D15
New User
Yup, share is share. He'd pay a third of the inputs $90 in your figures, and get third of the proceeds, $180 by your acct. Leaves him with about $90 rent. $40 sounds cheap for land that will grow corn. One advantage of share rent, it takes out part of the risk. If you have a bad year he shares the loss.
Anonymous-0
Well-known Member
So if 1/3 of the gross you make roughly $102/acre above costs. That is approximately what my tenant budgets and in this area is considered a decent profit. The $40/acre rent wouldn't leave much after paying the real estate taxes. I would be seriously investigating an alternative such as CRP if $40/acre was the only offer I could get. If you expect "all" of the profit then purchase the ground.
Here,it depends on how long you've owned it. Land that you've owned since before it was "capped" in 1994,taxes are pretty cheap. Mine average somewhere between $12 and $13 an acre. Now if I was to sell it to somebody else and it came "uncapped",unless the buyer put it in a farmland preservation program,you couldn't afford to own it.
Your rent has not kept up with the price of commodities. With the numbers that you provided, you made $280 per acre and he made $40. An you have to ask if he is right in asking for better compensation??? You are making a very good profit and he is not getting a very good return on his land.
I see a new tenant in his future if you do not compensate him a little better.
Here in Iowa when we shared cropped the land owner got 1/3 on soybeans and 1/4 on corn. They just provided the land, nothing else.
We did do some 50/50 share crops deals. Then the tenant and the owner split the fertilizer and seed cost. The chemical cost was the tenant's. The land owner paid half of the harvest cost and for his crop to be hauled or dried. Then they split the gross check.
Just had to bid up the rent on a farm we have farmed for twenty two years. Window's kids where telling her how high "good" land was renting for. BTO where wanting it bad too. I paid $300 last year and had to go to $375 for this next year. I did get her to agree to lower 2013 rent back down if commodities go down.
I see a new tenant in his future if you do not compensate him a little better.
Here in Iowa when we shared cropped the land owner got 1/3 on soybeans and 1/4 on corn. They just provided the land, nothing else.
We did do some 50/50 share crops deals. Then the tenant and the owner split the fertilizer and seed cost. The chemical cost was the tenant's. The land owner paid half of the harvest cost and for his crop to be hauled or dried. Then they split the gross check.
Just had to bid up the rent on a farm we have farmed for twenty two years. Window's kids where telling her how high "good" land was renting for. BTO where wanting it bad too. I paid $300 last year and had to go to $375 for this next year. I did get her to agree to lower 2013 rent back down if commodities go down.
newfarmer9
Member
Around here (SW Ontario) 1/3s are generally as Straw Boss described. 1/3 of gross to landowner, 1/3 of gross to renter for input costs, and 1/3 to renter for labour. Cash rent here is in the $200-$250 range on average, some a little less if you're lucky, some a little more.
I do shares on a 40 acre piece I have. I get 1/3, renter gets 2/3's. I never see any expense sheet so don't know if he takes some of the grain to cover my expenses or not. Bad part about shares is you are at the mercy of your renter. I can't drive the 100 miles where my land is to sit and watch what is harvested. To many times when prices were good, the 1/3 share comes real close to what the cash rent would be on the low side. Always seems to take to long for him to figure my share also. Oh, did I say my brother is my renter!
It"s been years since I saw any share rent here- either 50-50 or 1/3-2/3. 50-50...all income and expenses were split that way, all labor, equipment, etc. by farmer. My cousin said when he rented from his dad that way, he finally made some money. More common was doing thirds. Owner provided the land, got a third of the crop. Renter paid all expenses, got two-thirds of crop. Typical here, after the end rows were out........corn was combined in a pick 8, leave 4 pattern across the field. Compensates for changes throughout the field. Virtually all is now cash, sometimes tied to yield and price.
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