More than half of Iowa farmland is rented. In some Iowa locations, as much as 70 percent of the land is farmed by farmers who don’t own the land. In Northeast Iowa, the result is many conversations and negotiations between farmland owners and producer-tenants to determine what makes sense for farmland leases and cash rental rates – both fixed rent and flexible arrangements. Strong landlord/tenant relationships are important for the long-term viability of Iowa’s farming communities. These are just a few reasons why Iowa State University Extension and Outreach offers workshops designed to answer questions that land owners and tenants have about farmland leasing and land values.
A local workshop will be held on Thursday, August 9th at 9:00 a.m. at the Community Center at the Delaware County fairgrounds. Melissa O’Rourke, ISU Extension Farm & Agribusiness Management Specialist will present a wide range of topics related to farmland values and leasing. O’Rourke is a licensed attorney with extensive experience in working with farm, ranch and agribusiness interests.
“Year after year, I receive numerous contacts from persons who have questions about farmland values and rental rates,” says O’Rourke. “The interest in and conversations about farm leasing arrangements continues to grow, and 2018 is no different,” O’Rourke noted. “We always have good attendance and discussion at these meetings. Due to the volatility of land and commodity markets, we have seen had increased inquiries regarding both fixed and flexible cash lease methodologies,” says O’Rourke. “There are dozens of methods for putting together flexible cash lease arrangements, and we will work through several examples.”
O’Rourke also noted that ISU research indicates that on average, cash rent values across the state have declined for three consecutive years. O’Rourke has also seen that farmland owners and producer-tenants need to have more conversation about the cost of inputs to put in the crop and reasonable expectations on profit margins. “ISU Extension and Outreach has good resources for people to use to gain an understanding of how crop input costs can be considered in setting cash lease rates, and I’ll show how those can be used.”
O’Rourke also noted the increasing age of farmland owners. “ISU Extension research indicates that the average age of farmland owners continues to rise,” stated O’Rourke. “Fifty-five percent of Iowa’s farmland is owned by people over the age of 65, while 28 percent of the land is owned by individuals over age 75. We find that children and surviving spouses may be less likely to continue operating the farm themselves. That’s a major reason why farmland leasing continues to increase.”
O’Rourke encourages anyone with an interest in farmland rental rates to attend these meetings. “Both farmland owners and producer-tenants should attend. In fact, the ideal situation is for these folks to attend together and then sit down at the kitchen table to discuss their farm lease arrangements for the coming year.”
Workshop attendees will receive a comprehensive workbook packed with information about land values, leasing and different types of farm lease arrangements. “Everyone should leave with a heightened understanding of farmland leasing.”
A registration fee of $20 per person is charged to cover costs and includes a 100-page workbook. Pre-registration is preferred by calling the Delaware County Extension Office at 563-927-4201. Walk-ins may attend for a $25 fee at the door. More information about this and other farmland leasing meetings in Iowa can be found at ISU Extension’s Ag Decision Maker website: www.extension.iastate.edu/agdm