Fair rent agreement.

[poorboy]

Greed is an interesting component of this...

If the land can grow 50bu of Canola... the land owner is reasonably entitled to 23% of gross revenue[at $1100/ac].

$650/ac cost... is now at $540 [33% - 23% = 10% or $110 towards crop production] cost to that farm operator, still over $300/ac net for the grower... how is that unfair when actual monetary investments committed by each party is considered.

Reasonable is Reasonable...

Blessings and Wisdom

Not sure on your math Tom. 50 bushel canola at $17 less 23% to landowner leaves $650 gross. Fert, Seed, Chemical cost me $340 this year and machinery, fuel, labor, interest, freight costs are hard to peg exactly, as they keep going up, but for this discussion call them $200/ac. Leaves the farmer $110/ac.

Can’t grow canola every year, so most other crops have lower net returns, so farmer averages what $40/ac per year on a 4 year term?

With the higher costs for everything and higher cash outlay, is $40/ac net profit on rented land worth pursuing? I am thinking your 23% landlord share barely works in 50 bushel canola country and that % would have to be lower as you move into lower yielding areas.

[jazz]

Sort of a bit of hypocrisy here. So you want the land lord to be reasonable and supportive especially to young guns who are apparently hard up, but then you bring out 3 X9s for good measure.

Landlords arent stupid. if you can finesse the math that you need new equipment every year with a $100k greenlight to boot and spend $650 per acre to grow canola, well then he can squint and up the rent $20 per acre.

Farmers are their own worst enemies sometimes. BTO fever is gonna kill this biz.

Rent should be based on what you would get if you sold that quarter and stuck it in a GIC or stock or something. The renter should pay a premium off that because he doesnt have the lending risk. He can leave you high and dry in 3 yrs, but not FCC.

So say 5% of $850k is $265 per acre. Renters are getting a steal as far as I am concerned.

[fjlip]

Local latest's offers...$3500/acre or $135 rent cash rent.

[blackpowder]

2-2.5% here. $5-6000, $100-150. Any more would be unsustainable.
Owners banking appreciation curve, for now