NEWS

Crop land renting is about more than just a number

Emily Adams

Sometimes it can be really easy to find the numbers you are looking for. You can find just about anything on the Internet, right? Did you know that the total number of bacteria living on the average human is estimated to be 1 trillion? Or that an estimated 365 to 988 million birds die from crashing into windows in the United States each year?

Sometimes it can be difficult to locate the right number. There are lots of formulas and equations that help farmers with many aspects of their jobs. One number I am often asked about is difficult to answer. “What is crop land renting for in a specific part of Coshocton County?” It is difficult to answer, because there are many factors that should considered when developing a cash rental rate for farmland.

Barry Ward and Peggy Hall recently presented a Farmland Lease Workshop for Coshocton County and Tuscarawas county residents. Ward is leader of Production Business Management in the Department of Agricultural, Environmental, and Development Economics at OSU. Hall is an attorney and director of Agricultural & Resource Law at OSU.

Ward and Hall talked about the many tools available to assist with developing farmland leases. Because it is such a popular question, they shared information about establishing cash rental rates. In the end, supply and demand will be the primary driver of rates. And it is the expected return from producing crops on a specific piece of land that will determine the demand to rent the land.

There are several other factors that may play a factor in negotiating a rental rate:

• Expected crop return

•Variability of crop return – this includes soil fertility characteristics and drainage capabilities

•Buildings and grain storage availability

•Size of farm – larger fields allow for gained efficiency by the operator

•Location of farm – includes road access

•Shape of fields – a “more square” field allows for greater efficiency

• Previous tillage systems or crops

•USDA Farm Program

•Services provided by 0perator – these include those “going the extra mile” services like clearing fence rows and plowing snow for the landowner

•Considerations of lease

•Payment dates

•Reputation of landowner/operator

•Special contracts that are tied to the farm

•Field border characteristics

•Wildlife damage potential – this is a factor that landowners may not often consider. We love Coshocton County and so do all our deer, groundhogs and other critters.

So as you can see, when it comes to determining a cash rental rate, it is much more than just a number. Sure we have reported rates from across the state of Ohio that show trends over time, but determining the rate for a specific parcel of land is going to require conversation and evaluation. And once you have thoughtfully determined a fair rate, the next step is to develop and sign a written lease. A very helpful website that is specific for agricultural leasing is aglease101.org. It is maintained by university Extension faculty from several Midwestern universities. There are many answers to frequently asked questions.

When thinking about rental rates and leases consider this quote from Rick Riordan: “Fairness does not mean everyone gets the same. Fairness means everyone gets what they need.”

Emily Adams is the OSU Extension educator for Coshocton County. She can be reached at 740-622-2265 or adams.661@osu.edu.