How much were you able to reduce land rent costs for 2014?

As corn and soybean prices have dipped to levels not seen in quite some time, we're wondering if land rents have done the same? Will it be necessary to have lower cash rent in order to meet your bottom line? We'd like to know: how much were you able to reduce land rent costs for 2014? Not at all? 5-21%? More than that? Or did you not need to get your rent costs lowered for the year? Take the poll and let us know. Also, leave a comment with your thoughts on your current land costs and how those will impact your bottom line this year.

Discuss this poll 47

Anonymous
on Mar 3, 2014

rents up 8% need to be down 8% no luck getting that done. The Landlords seem to just here about the very highest rents

Anonymous
on Mar 2, 2014

It use to be a toss up.Cash rent vs crop share.Now the landlord makes far more money in cash rent situations with no risk

Anonymous
on Mar 1, 2014

all are going up or want to. the worst are these farm management companies. they don't care about anything but getting the highest price possible, so they get a bigger commission for themselves.

Anonymous
on Mar 1, 2014

With recent land sale prices increasing , landowners are looking more at % return on thier investment now than before !

Anonymous
on Feb 26, 2014

We raised rents every year the past 5 years, and paid bonuses each year due to higher incomes. So, with prices looking down, rent comes down. We stay with the flow, up or down.

Anonymous
on Feb 26, 2014

Due to higher CAUV values, my father-in-law will be asking his tenant for higher rents this year.

Anonymous
on Feb 19, 2014

You left out "they went up 20%"

Anonymous
on Mar 3, 2014

aint that the truth!!!! land owners in my area will never lower rent theres always someone willing to offer more than we pay now.

Anonymous
on Feb 19, 2014

It won't break me this year, but many higher rents are not sustainable with the current outlook picture.

Anonymous
on Feb 19, 2014

Fixed bushels formula with crop shared above 5 year average bushels is fair .

Anonymous
on Feb 17, 2014

breakeven on higher rent 5.62 rents need to come down

Anonymous
on Feb 17, 2014

Hi,
I am Aline Ferro, agribusiness analyst from Brazil. The land rent costs increased a lot in the recent years due to increasing of agricultural commodities prices. In practice, the contracts are based in bags (60kg) of soybean, so the behavior of soybean prices impacts directly in the land costs. But in Brazil the most part of farmlands is operated by owners. So, indeed, there is not the real trend of reducing area due to the high costs. The soybean area increased, but the corn area is decreasing in 2013/14 due to the the lower profitability of the last harvest.

My best regards,

Aline Ferro
CĂ©leres - Brazil
aferro@celeres.com.br

Anonymous
on Feb 17, 2014

Land sells for 15K to 16K per tillable acre on high productive soil. Income has been beyond belief in our part of northern IL. It will take a couple years of low prices before we see change. We have been really burned for letting land escape from us.

Anonymous
on Feb 17, 2014

the dicussion of lowering cash rent with most land owners would in our area be like taking them to a comedian--it would just make them laugh. I think there are some that would understand but most would just lease to one of the big dogs in the area for more $.

Anonymous
on Feb 17, 2014

We have long term relationships where rent neither goes up or down. I refuse to get into a bidding war with anyone.

Anonymous
on Feb 16, 2014

We have some very aggressive cash rent idiots in our area that make it extremely difficult to make a profit. Hopefully these guys will take a big hit as well as landlords to bring the rents to a more manageable level.

Anonymous
on Feb 16, 2014

Land rent will not drop

Anonymous
on Feb 15, 2014

I tried to get a 10% reduction, but the farm manager chose to leave it the same

Anonymous
on Feb 15, 2014

We use variable cash rent rate. We have a lower base rent than add if needed additional money if so warrented on the crop year yield and prices

Anonymous
on Feb 15, 2014

Our rental agreements are viewed as long term relationships and haven't experienced the dramatic rise of the last few years. Increases tend to follow a longer term inflationary trend which keeps them at a more realistic level while gradually increasing as needed over time.

Anonymous
on Feb 15, 2014

Have one land lord that recognized crop prices were lower and reduced rent 25 per acre. Iowa code makes it hard to change rental rates after sep 1.

Anonymous
on Feb 15, 2014

some of my landlords think they need more yet.

Anonymous
on Feb 15, 2014

I hear versions of this question a lot lately. With the last few years farm revenue at all time high, why would the landlord have reduced the rent last August? My rented land cost has gone up every year through this period. Farmers have always carried the risk of profitability for a variety of reasons. We get no "KINGS X" in the real world, whether it's prepaid inputs, capital purchases , or rental contracts. We won't see land rent come down until farm income is at or below cost of production. Until then if I am not willing to pay the rent, someone else will probably step in to try it. I have seen our local "county farm" rented the last years with feverish auction bidding. After their contract is up, they lick their profit wounds and let it go. I have farmed a lot of years and two things have never changed. The element of greed from all sides and within have always been against us and farmers are usually their own worst enemy. A farmer must have good communication with his landlord. If he doesn't cultivate a relationship with the landlord, he probably won't cultivate his land.

Anonymous
on Feb 15, 2014

Our rents are staying the same as last year.Our taxes are 50 to 55 $ per acre and taxes are projected to go up 20 % for 2015 OUCH !!!!!

Anonymous
on Feb 26, 2014

You must be farming in SE Minnesota. RE taxes in this area are out of control.

Anonymous
on Feb 15, 2014

Rents never drop here, there is always a large farmer who will pay more no matter how low the margin gets. I, on the otherhand, don't farm just so landlords can get rich.

Anonymous
on Feb 15, 2014

We just did a new cash rent increase with our landlord !!!
The land taxes have increased so much the last couple of
years around here that they almost demanded it !!!!!!!!
If you don't give it somebody else will !!!!!!!

Anonymous
on Feb 15, 2014

It went up

Anonymous
on Feb 15, 2014

Remained the same

Anonymous
on Feb 15, 2014

Depends upon where you have been the past four years. We have had lower rent than many and do not anticipate lowering rent in 2015 eithter

Anonymous
on Feb 15, 2014

I have some crop share and some cash rent. West of Omaha NE. All dry land! Most of my land has been in a reasonable cash rent or crop share for years. $150-$185/acre Last year (2013) one owner wanted his rent to go to $300 per acre (just average ground) I went along with it. This year (2014) After several years of crop share, another owner wanted a change. (He got around $225 for his share in 2013 with corn at $4.12) We also had fairly high yields on dryland in 2013. For 2014 the owner wanted to go to $300 an acre up front cash rent. I thought about it and told him I would do $225 up front now. I even offered to do a flex lease. With soybeans this year I would have probably been OK. He still wanted $300. I always helped him put round bales in his shed with my tractor and loader for free each year and gave him cheaper prices for hay he bought from me. He is appreciative of this, but still took his land to a guy next door! Only 20 acres. That's the way it goes! I'm going to tell my other high cash rent owner that this year will be my last with these high rents. I'm dealing with farming around their houses and all the stuff that blows out in the field from where they live. These are really great people that I consider friends. BUT If you can't have a little space to make some profit without coming down to the last few dollars, it's not worth the stress. Not for this few of acres! If owners want big returns (Some of them think that's what all the operators get all the time, and some years there are good returns) they need to jump in the crop share world! At least with CS it's fair with the roller coaster ride of farm economics. If an owner wants cash rent up front they need to be reasonable or have a flexible cash rent negotiated. Some operations are paying way too high of cash rent just to have more acres. Already saw a local large operator farm sale the other day. Heard he was going broke! Don't want to be in that situation.

Anonymous
on Feb 15, 2014

none they goy raised

Anonymous
on Feb 15, 2014

You missed including one very important choice for 2014. Our land rent costs were increased for 2014 by approx. 10%.

Anonymous
on Feb 15, 2014

Rent went up 25%

Anonymous
on Feb 15, 2014

farm manager

Anonymous
on Feb 15, 2014

I think it will take a few years for rent to start going down. There's still too many farmers who would pay anything if they get the chance.

Anonymous
on Feb 15, 2014

Actually I had to increase our land rent. Tell me what my yield will be and what price I will sell at and I will tell you how it will impact my bottom line. Perhaps God can answer this question???

Anonymous
on Feb 15, 2014

I rent no land. I own all the land I farm. I would like to rent some, but someone always has deeper pockets than mine.

Anonymous
on Feb 15, 2014

I think any land rent that is 5% of the land price is cheap, it's the seed and fertilizer price that is way over priced, the inputs are worthless with out the land. Allan W. Iowa

Anonymous
on Feb 15, 2014

Most landlords are trying to hold their rent up as high as possible. In order for rents to come down in our area some farmers are either going to go broke or downsize to owned land. Either way cash flows for this year are going to tight. This year I expect to live off of savings. There will be no profit. Hopefully there is no actual loss.

Anonymous
on Feb 15, 2014

As a retired farmer I did not lower rent to the tenant for 2014. He made too much money off of me when corn was $7+. In fact I should have increased rent as real estate taxes are going horrendously up every year eating away at my net rental income!!!

Anonymous
on Feb 15, 2014

Rents are not coming down in our area. Some going up. Very difficult to pencil a profit at these levels.

Anonymous
on Feb 15, 2014

I have some landlords who expect a certain ROI. They don't care if my ROI is negative. I guess maybe I should remind them that their ROI really stands for return on inheritance.

Anonymous
on Feb 15, 2014

We are maintaining our cash rent levels for 2014. We are tighting up on all other expenses getting ready for tighter margins

Anonymous
on Feb 15, 2014

Kept rents the same as last year to start with, may adjust at end of season. Must said they didn't go up as fast as others when rents were going up.. Rent about 2000 arces, all cash rent. Most landlord are 20+ years

Anonymous
on Feb 14, 2014

rents up 8% need to be down 8% no luck getting that done. The Landlords seem to just here about the very highest rents

Anonymous
on Feb 13, 2014

Rent didn't really change went land and grain prices went up, so I can't really complain about it not going back down now

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