Posts tagged ‘cash lease’

2010 Agriculture Cash Rent Data for NW Ohio Released

The following was developed and compiled through great research conducted by Barry Ward, Ohio State University Extension , Production Business Management.

Ohio is a diverse state agriculturally and cropland values and cash rents vary tremendously across the state. Generally speaking, western Ohio cropland values and cash rents differ a fair amount from eastern Ohio cropland values and cash rents. This is due in part to one of any number of factors including land productivity and potential crop return, variability of crop return, field size, field shape, drainage, population, and ultimately the supply and demand of rented cropland in an area.

Ohio cropland values show signs of remaining stable to falling slightly in 2010 while this survey indicates cash rent levels will see little change in 2010. According to the Western Ohio Cropland Values and Cash Rents Survey bare cropland values are expected to decrease from 0.1% to 3.1% in 2010 depending on the region and land class. Cash rents are expected to range from a decrease of 1.5% to an increase of 3.19% depending on the region and land class.

Ninety-five surveys were completed, analyzed and summarized. Respondents were asked to give responses based on 3 classes of land in their area; “top” producing land, “average” producing land and “poor” producing land.

Tables show the average (Avg) (simple average) of each row, standard deviation (Std) of the data for that measure (measure of variability), average plus one standard deviation (Avg + 1 Std), and average minus one standard deviation (Avg – 1 Std). These latter two numbers reported indicate a range within which about two-thirds of the responses in the data for that measure will fall.

April 14, 2010 at 12:55 pm

Tips for Obtaining County Cash Rent Data from NASS

Thanks to the folks at National Agricultural Statistics Service (NASS), we now have county-based cash rent information.  I’ll save you a few steps if you are interested in cash rent for Van Wert County. The cash rent for marketing year 2008 was $126/acre.

Here is the procedure I recommend you use to get the data for your area:

1. start at the NASS homepage

2. navigate to the left sidebar and click on ‘Economics’, which brings you to this page

3. select ‘cash rents’ then hit the search button

4. Select: County Cash Rents Data Query –

5.  Under “Select Location” – “Locale” select: COUNTY

6. Under “State” select: OHIO (or whatever state you have an interest)

7. You can select an individual county but I recommend you skip that and go to the bottom and select: Get Data

This will give you county by county cash rent averages from this Ag Stats survey for the entire state.  From what I can see based on Van Wert County, this data is fairly representative and is a good place to begin the cash rent negotiation process.

May 4, 2009 at 11:58 am

County-Level Cash Rent Data To Be Released May 1

Getting accurate and reliable cash rent data is sometimes challenging, and it looks like we might have another good source in addition to OSU.  The below news release is from NASS:

The National Agricultural Statistics Service (NASS) will publish county-level data on cash rental rates for agricultural land on May 1 at 3:00 p.m. EDT.

The information will include average rental rates for non-irrigated cropland, irrigated cropland and pastureland during the 2008 calendar year. NASS is providing the county data in response to requests from customers as well as the new requirements of the 2008 Farm Bill.

Since 1997, NASS has published land value and rental rate data at the state level. The release on May 1 will mark the first time NASS is publishing the information at the county level.

The data will be based on information NASS gathered from 700,000 agricultural producers nationwide during the 2008 end-of-year surveys: the biannual cattle survey, the biannual sheep and goats survey, the quarterly crops/stocks survey, the annual acreage and production survey, and the first-ever county-level cash rents survey.

The county-level data on cash rental rates will be available online through Quick Stats, NASS’s agricultural statistics database, at Users will be able to access cash rental rates at the state, county or crop reporting district level.

I’ll check the data and examine how it compares with my own research.  If there is much of a discrepancy, I’ll post about in this blog.

April 29, 2009 at 8:30 am 2 comments

Flexible Cash Lease Calculator Available from OSU

Barry Ward, Ohio State University Production Business Management Leader, has developed a flexible cash lease calculator for farmers and landowners.  The calculator is available as a Microsoft Excel worksheet:

This flexible cash lease tool is intended to help landowners and tenants agree on terms of their flexible cash lease. Unlike other tools available at other schools, this tool allows the user to do more than just flexing for price and yield. This tool includes the opportunity to input costs of inputs that would affect the terms of the lease.

The Input Page is the section of the calculator where the user inputs their particular production numbers. This page has several different sections where user input is required for an accurate estimation of a flexible rent. The information you need to have available to use the calculator includes: previous rent information, yield history, fertilizer input costs, chemical input costs, diesel input costs, seed input costs, and any other relevant input costs.

The Output Page documents four different methods of calculating your flexible cash rent. The different methods include flexing for price only, flexing for price and yield, flexing for price and input costs, and flexing for price, input and yield. In all four methods, the Total Rent per Acre line is the suggested flexed rent per acre for the land for the end of the growing season. Choosing which method to decide rental rates from will come from negotiation between land owner and tenant.

Podcast available here:

December 10, 2008 at 7:00 am

Flexible Cash Rents Becoming Common

I know that some farmers have spent the better part of 2008 working on trying to get some of their fixed cash rent acres converted to flexible cash rent acres. And, fortunately, many landowners are open and receptive to the idea. The move to flexible cash rents is gaining momentum not just in my neighborhood, but across the Midwest as operators look for ways to stop the flow of red ink in the coming year. Ohio State University Extension has been providing flexible cash rent resources to farmers for years. Specifically, the OSU Factsheet written by Robert Fleming (retired) and Don Breece provide much of the framework for establishing flexible cash rents (

On the other side of the negotiating table, landowners, seeing higher profitability in commodity crops, are seeking higher cash rents. So, just what is that “most equitable” cash rent amount and how can it be maintained from year to year or contract to contract? One answer is negotiating a flexible cash lease arrangement that varies from year to year based on price or yield or a combination of the two. Price and yield deviations from an agreed upon starting point (base rent) will trigger additional rent in the case of higher prices or yields or possibly lower rent in the case of price or yield shortfalls.

One of the most comprehensive and current articles I have seen on flexible cash rents was written by the Ag Decision Maker team of Edwards and Johanns. Their article “Flexible Farm Lease Arrangements” was written in August of this year and provides some excellent examples of flexible cash rents ( The examples are Iowa-based, but they can provide the groundwork for you to establish a flexible rent in Ohio. Edwards and Johanns point to three benefits of utilizing flexibility in a cash rent. The most important benefit, in my opinion, is that risks are shared between the owner and the operator similar to a crop share arrangement. But unlike the crop share arrangement owners are paid in cash, they do not have to be involved in decisions about crop selection, fertility inputs, grain marketing, etc.

About a year ago there were several questions that were brought up regarding government payments under a flexible cash lease arrangement. The Farm Service Agency specifies that certain flexible cash lease arrangements are in fact “crop share leases” and certain government payments (direct and counter-cyclical payments) will be divided up between tenant and landowner according to the risk each bears in the production of crops on the leased parcel. To comply with FSA guidelines tenants and landowners need to do one of two things. First, landowners need to provide a copy of the flexible cash lease to their county FSA office, and request approval for the proposed sharing of the direct and counter cyclical payments. Second, they need to structure the flexible cash lease so that it is defined as a cash lease arrangement under FSA Guidelines. See the below example for clarification.

Example: A lease states, “The annual rental payment is $150 per acre, but in the event that average corn yield for the county exceeds 170 bushels and/or the average cash price at the local elevator for the months of September, October, and November exceeds $3 per bushel, the rent per acre shall be $175 per acre.” This lease would be considered a cash lease because the bonus payment is not tied to a specific yield on the farm nor the price received for that specific production. In cash-lease situations, the tenant is eligible to receive 100 percent of government payments for the applicable farm, provided all other program eligibility requirements are met.

For more information on flexible cash leases, please visit the April, 2008 issue of the Ohio Ag Manager website at

December 1, 2008 at 7:00 am 2 comments

Cash Rent of Publicly Owned Ground in Van Wert County, Ohio

Cash rent continues to dominate local conversations. In fact, during the recent Farm Tour in Van Wert County there were several references to cash rent for farmland. Several months ago, I called to get the cash rent information on Van Wert County’s publicly owned lands.

Parcel: Van Wert County Farm (adjacent to the old county home)
Acres: 305.4
Per Acre Cash Rent: $191.91
Term: 2008, 2009

Parcel: Airport
Acres: 131.6
Per Acre Cash Rent: $131.13
Term: 2007, 2008, 2009

July 25, 2008 at 7:00 am

Farm Cash Rent in Ohio – That Fickle Subject

NOTE: No podcast today. Just a good old-fashioned article.

If I had a dollar for every question I get about cash rent (also referred to as cash lease) I’d have enough money to take my entire staff out to a nice lunch . . . twice.

Contrary to popular belief, I do not tell landlords “You should be charging $X dollars per acre.” Nor do I tell farmers that they should pay $X dollars per acre. Between peer pressure, media reports, and family attorneys, there is enough information to fuel the cash rent frenzy without me getting involved. Yet I seem to be involved quite often, probably because OSU conducts cash rent surveys.

Here’s how a typical conversation goes.

Caller: What’s the cash rent for (fill in the blank). (the blank is either Van Wert County, a township, or a even a specific farm).

Andy: I don’t have detailed cash rent information specific to Van Wert County, but I do have data that is collected annually from ag lenders, FSA employees, Extension employess, farmers and landlords. This data is summarized by Barry Ward and available online (at which point I refer the caller to the online document:

(I continue): Ohio survey data indicates that cash rents in the “average” cropland category equal 3.5% of land value. Rents in the “top” cropland category equal 3.7% of land value. (Every caller considers their land as ‘top quality’ , but I digress)

At this point the caller and I discuss land value, which has risen sharply over the past several months, and we do some multiplication to get ‘a number’. From that point I say: “This is a starting point for negotiation, but understand that cash rent determination should be based on many factors.”  I also add, “Would you consider a flexible arrangement for cash rent, to share the risk with the farmer?”  But frankly, most individuals that contact me want ‘a number’ that they can count on, and are not very open to flexible provisions.

I’m thanked for my time, and the call ends. That’s 99% of cash rent calls in a nutshell. I’ll save the story of the other 1% for another article.

To review flexible provisions with cash rents, I suggest reading the excellent article by Fleming and Breece at or the North Central Publication

July 10, 2008 at 1:00 pm


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