Farmland Leasing Arrangements

Ron Hook, Field Specialist-Farm Management, Northwest Area

Problem Statement: 

The increase in grain prices resulting from increased grain usage in the bio-economy caused many tenants and landlords to question the terms of leasing arrangements for 2008.  Current information about alternative leases to cash rent leases was needed by both tenants and landlords as they determined terms for leases in 2008.

Programmatic Response: 

Farmland Leasing Arrangements workshops were conducted by me in my area during the summer of 2007.  These workshop provided current information on land values, cash rental rates, alternative leasing arrangements, input costs for corn and soybean production and other factors that should be considered in farmland leasing arrangements.  Twelve workshops were held in northwest Iowa with 462 participants.

Impact/Outcome: 

A survey of 100 participants conducted at the end of the workshops was completed by 50 individuals.


        Switch from cash rent to a crop share lease arrangement rated 4.51
        Switch from a crop share lease to a cash rent lease arrangement rated 3.67
        Put in place a flexible cash rent lease arrangement rated 4.16
        Rent to a beginning farmer and apply for the Beginning Farmer Tax Credit rated 4.33
        Sell farmland in the light of current high prices rated 4.81
        Trends in farmland values increased from 3.70 to 4.17 on a 1 to 5 scale
        Farmland leasing trends increased from 3.06 to 4.17 on a 1 to 5 scale
        The seven methods of calculating fair cash rent value increased from 2.15 to 4.04 on a 1 to 5 scale
        The basics of a flexible cash lease increased from 2.0 to 3.66 on a 1 to 5 scale
        The Beginning Farmer Tax Credit increased from 2.02 to 3.55 on a 1 to 5 scale
        Legal issues related to renting farmland increased from 2.83 to 3.96 on a 1 to 5 scale
        Resources available from ISU Extension for farmland leasing information increased from 2.72 to 4.09 on a 1 to 5 scale

2008
120  Farm and Business Management

Page last updated: April 11, 2008
Page maintained by Linda Schultz, lschultz@iastate.edu