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- Thread starter Buddy
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larryanderson
Well-known Member
We have a few BTOs that call every landlord and
offer top rent up front[$450/$500 per acre] for
3yrs.They have fancy websites and sometimes
advertise with rent fiqure in the papers.The land
in our County has a CSR of about 75 average.They
are also the ones who have many acres not planted
and will get an insurance check.They in some cases
mine the nutrients out by corn only.They are not
popular and usually get new leased equiptment from
a different brand often as they cant always
pay.This makes it hard for the young starting and
established family farms that know $7 corn is
already gone and $300/350 will barely work
especially as rain was short and our crops are
average at best.Crop Insurance that is Goverment
subsized is how a lot of them survive.Sometimes
they seek mental hospitals to keep from being
audited.As you can tell I dont care for these kind
of A.H.s and hope the will go broke quickly and
they will.They also complain why the rent is so
high.
offer top rent up front[$450/$500 per acre] for
3yrs.They have fancy websites and sometimes
advertise with rent fiqure in the papers.The land
in our County has a CSR of about 75 average.They
are also the ones who have many acres not planted
and will get an insurance check.They in some cases
mine the nutrients out by corn only.They are not
popular and usually get new leased equiptment from
a different brand often as they cant always
pay.This makes it hard for the young starting and
established family farms that know $7 corn is
already gone and $300/350 will barely work
especially as rain was short and our crops are
average at best.Crop Insurance that is Goverment
subsized is how a lot of them survive.Sometimes
they seek mental hospitals to keep from being
audited.As you can tell I dont care for these kind
of A.H.s and hope the will go broke quickly and
they will.They also complain why the rent is so
high.
Wow. I didn't think there was those kinds of rental rates anywhere. In our area there is very little land under $275. Most in that $350 range with some hitting $550. Common rule of thumb for investors is 5 % of their purchase price. Hard to get that kind of return if they pay up over that 10k an acre range.
Pasture ground around me is renting for $75 for rough billy goat ground. Good farm ground is $350-550 cash up front. I just rent two farms anymore.
I am giving $200 for the one but I am doing many improvements on my dime, like fences, gates, water control devises, etc. I will have much more than $500 in it this first year. I have a ten year contract. So it will average out.
The other farm I am giving $400 for. My sons have most of their rented ground in the $350-450 range.
You either pay it or lose the ground. It is going to be tough next year to make anything.
I am giving $200 for the one but I am doing many improvements on my dime, like fences, gates, water control devises, etc. I will have much more than $500 in it this first year. I have a ten year contract. So it will average out.
The other farm I am giving $400 for. My sons have most of their rented ground in the $350-450 range.
You either pay it or lose the ground. It is going to be tough next year to make anything.
There are a lot of areas where there is a lot of risk in terms of getting a good crop out of the land. In other words 220 bushel corn and 60 bushel beans are anything but a "gimme.' I think the rule of thumb you are providing will be obsolete in a few years as production will overtake demand driving rental prices down. Landlords then will have the choice at that point to hold their breath till they turn blue or take the best bid regardless of return. Corn even at 220 bushels will not justify 300 dollar rent if the selling price per bushel is in the sub 3 dollar a bushel range. Change is coming and everybody will have to deal with it regardless of how prideful or arrogant anybody is. Economics is economics. It might be a whole new world starting next year if the Feds are done with grain subsidies including subsidized crop insurance which is the lynch pin for about 95 percent of the BTO's here. I expect a lot of land will come up for bid in the near future as these farmers simply will not be able to finance crop inputs for their current acreage.
When our Dad died, I arranged for my younger brother to take over the farm. A couple of Dad's friends that were retired volunteered to help my brother as he couldn't afford to pay hired help.
When my brother retired, he turned down all offers for cash rent from the BFO's. He chose a young neighbor boy who could use his Dad's machinery - and rented the farm to the young man on shares instead of cash rent. The young man is now doing fine, as is my brother. That young man will still be farming when the BFO's are long gone.
I'm very proud of my brother for remembering that people helped him get started and he has done the same.
When my brother retired, he turned down all offers for cash rent from the BFO's. He chose a young neighbor boy who could use his Dad's machinery - and rented the farm to the young man on shares instead of cash rent. The young man is now doing fine, as is my brother. That young man will still be farming when the BFO's are long gone.
I'm very proud of my brother for remembering that people helped him get started and he has done the same.
danmcdonald
Member
I get $300 Midwest ILL.
I"m in eastern Virginia and i hear a few are getting $100 but the last guys I knew were paying that went broke in about 3 years. With the really good prices for the last 4 years or so it"s been easy to maintain status quo and pay that but inputs have been going up and I agree with JD SELLER it"s going to be really tough for a while. Aorund here if you break 200 bu/ac it"s with irrigation, the average is more like 130-140 bu. with beans being under 40 bu. This (2013) was a really good year in that we had plenty of rain all summer and I averaged 157 bu. haven"t cut beans yet but they look good.
Everyone wants to forget last year and the year before but nature is what it is. Normally we have good rains right up to June then it tails off and we get one or two rains in July and that"s it till late September or early October. Two years ago we had a pretty dry spell just after corn got up that lasted into July then good rains the rest of the year; this year little dry at the start but the corn got enough to keep growing and it turned dry in mid September and looks like will stay pretty dry till close to the end of October. You just have to pay attention to how God waters the crops.
I think some boys are going broke next year because they pay high rents, bought new equipment and crop prices have softened AND I think the rains will be more normal.
Everyone wants to forget last year and the year before but nature is what it is. Normally we have good rains right up to June then it tails off and we get one or two rains in July and that"s it till late September or early October. Two years ago we had a pretty dry spell just after corn got up that lasted into July then good rains the rest of the year; this year little dry at the start but the corn got enough to keep growing and it turned dry in mid September and looks like will stay pretty dry till close to the end of October. You just have to pay attention to how God waters the crops.
I think some boys are going broke next year because they pay high rents, bought new equipment and crop prices have softened AND I think the rains will be more normal.
Bob in Oakboro
Member
Here east of Charlotte NC land is rented for about 60 dollars per acre. A lot of land around here is still done on shares. Usually about 20% of the profit after expenses are subtracted.
Dick, that"s great to hear that your brother remembered how he started. Its good to know that still happens.
Here in NE Iowa good is renting from 250-450 on average. Most of the guys that farm 750-1000 acres or less got their crops planted. Several of the BTOs just took the prevent plant and didn"t hardly plant anything. I know several land owners that were not too happy about this and pulled the rent from the BTOs and will be renting to neighbors again next year.
Not to knock all of the BTOs, there is some good ones that started from humble beginnings, are honest people and have earned every cent they made. The bad thing is you only hear about the other guys.
Here in NE Iowa good is renting from 250-450 on average. Most of the guys that farm 750-1000 acres or less got their crops planted. Several of the BTOs just took the prevent plant and didn"t hardly plant anything. I know several land owners that were not too happy about this and pulled the rent from the BTOs and will be renting to neighbors again next year.
Not to knock all of the BTOs, there is some good ones that started from humble beginnings, are honest people and have earned every cent they made. The bad thing is you only hear about the other guys.
Those rent prices make me cry. We also have a corn average of 125-150. Can't touch land here for under $200/acre and more then a few are paying in the neighborhood of $300. Why does it not pencil out over $100 there? Even at todays price here of $4.10, 140 bushel corn pencils with $200 rent. What inputs are so much higher?
Casey in SD
Casey in SD
Same thing happened here- old guy had a kid helping him on the farm, and continuing with lawn mowing and odd jobs after old guy quit farming and rented out the ground to a BTO. After high school graduation, kid came over with a good business plan to rent the guy's ground. Old guy said "Excuse me a second- I've got a call to make", and called the BTO while kid sat across the table, and cancelled BTO's tenancy at the end of the crop year, on the spot. Turned back to the kid and said "There, that's taken care of. Never much cared for that guy, anyhow. Now, lets make some plans." He ended up renting his machinery and ground to the kid and financing the inputs for the first couple of years, then selling him the machinery, then the ground, then helped kid get more ground. Old guy is long since gone, and kid has developed into an excellent farmer.
You never can tell what you might be developing for the future, when you do a good job of working for the neighbor.
You never can tell what you might be developing for the future, when you do a good job of working for the neighbor.
Longmeadow farm
Member
In the Mohawk Valley Region of New York, I rent crop ground for $40/acre and heavier soils grassland for $25/Acre. I have a rolling 5 year lease at $25/acre for a farm that was in ruins a few years back. The farm is slowly "taking shape'" ..just hope the landlord doesn't jack the rent on me... but I suppose it is inevitable.
Wow, no wonder the children and grandchildren of the folks that passed away and left the 100 acres around me to them haven't sold it like I expected. Don't know what local prices are but this is good farm ground and we have a number of BTOs in the area, and even at $100/acre that's not bad income each year for doing nothing but paying the land taxes!
(quoted from post at 11:51:56 10/09/13) Those rent prices make me cry. We also have a corn average of 125-150. Can't touch land here for under $200/acre and more then a few are paying in the neighborhood of $300. Why does it not pencil out over $100 there? Even at todays price here of $4.10, 140 bushel corn pencils with $200 rent. What inputs are so much higher?
Casey in SD
Casey, I ain't too far from you over here on the good side of the line :lol: .... The average guy here is putting about 350 and acre into planting, that comes to 550 and acre cost without harvest or transportation. Then get 140 BPA at 4,10 a bushel. That comes up to 574 an acre. I fail to see how that pencils out. Our rent here is about 50 and acres and yields can range from 80 to 220 BPA depending on the soil and rain.
Rick
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