University of Nebraska–Lincoln Responsive. Innovative. Trusted. Responsive. Innovative. Trusted. Prepared by: Allan Vyhnalek UNL Extension, Platte County 402‐563‐4901 [email protected]Farmland Management Cornhusker Economics Outlook 2014 Presented by UNL Extension Educators: Allan Vyhnalek Jessica Johnson Jay Jenkins Tim Lemmons Monte Vandeveer
34
Embed
Farmland Management Outlook - 2014 Cornhusker Economics Outlook
UNL Extension educators Allan Vyhnalek, Jessica Johnson, Jay Jenkins, Tim Lemmons, and Monte Vandeveer cover the farmland and rental outlook for 2014 and beyond.
Welcome message from author
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Notes about Land Sales First time in history – state sales topped $3000 per acre 49% of sales with cash (state‐wide) 47% of sales used a mortgage 81% of sales went to active Farmer/Rancher 2% to out of state buyer (state‐wide), but 25% in North 38% of land was sold by estates
Land Value Summary Prices for time being have at least stabilized Still more demand than supply Caused partially because land is being tightly heldWhere our family grew up has sentimental value
Lack of alternative places to put cash Land values are predicted to ‘deflate the bubble’ not ‘pop’ it
Farmland lease provisions – cont. Are bins included? Get electricity on it’s own meter
Sub‐leasing allowed? Cropland, stalks, or hay Hunting?
Get all leases in writing!! It’s not your grandparent’s handshake anymore Terminating handshake or verbal leasesNeeds to be done by 9/1 of any year for the next yearTermination notice is done by writing
Roughly 30% of the gross income should go to landlord Comes from 30‐70 split of crop share lease
200 bu. Corn times $4.25 per bushel is $900 gross per acre $900 gross times 30% equals $270 per acre rent Assumes the followingYield is APHPrice is Fall ‘14% can vary by crop and location in Nebraska
Consider Flexible Leases Extension Circular 862 – EC862 ‐ by Tim Lemmons Flex based on anything you want to –but typically: By price By yield Combination of price and yield
For true flex leases – have a floor and a ceiling – flex in the middle Also have ‘bonus’ rents in some situations
Extension is a Division of the Institute of Agriculture and Natural Resources at the University of Nebraska–Lincoln cooperating with the Counties and the United States Department of Agriculture.
University of Nebraska–Lincoln Extension educational programs abide with the nondiscrimination policies of the University of Nebraska–Lincoln and the United States Department of Agriculture.
Pasture Leases Runs from May 1 to October 1 (5‐month period) Includes the legal description of the land Shows in and out dates Describes penalties for early in or late out Describes when payments are due and how How are typical leases established/terminated? Verbal Written
Pasture Lease Considerations Stocking rate by head, AUM, pairs, frame, weight, color….. Termination provisions Contingency provisions Owner’s death Tenant’s death Sale Disaster occurrencesDrought or grass lossFire – or other
Extension is a Division of the Institute of Agriculture and Natural Resources at the University of Nebraska–Lincoln cooperating with the Counties and the United States Department of Agriculture.
University of Nebraska–Lincoln Extension educational programs abide with the nondiscrimination policies of the University of Nebraska–Lincoln and the United States Department of Agriculture.