The owner usually gives birth to land and buildings and bears half the cost of inputs such as fertilizers, seeds and pesticides when the 50-50 crop is divided. As a general rule, owners are also responsible for drying, storing and marketing their share in the crop. The tenant usually provides all the work, fuel, equipment and the other half of the shared expenses. However, there are many differences in cost-sharing. Publications FM 1811 (AgDM C2-15), Survey of Iowa Farm Leasing Practices and AgDM C2-30, Crop Share Leasing Provisions, provide more details on the distribution of expenditures under a Crop Share Leasing. AgDM Decision Tool C2-30, Crop Share Lease Analysis, calculates a landlord and tenant`s contributions to determine how profits can be distributed equitably. In recent decades, the trend has grown to lease more farmland in Iowa, not its owners. In many cases, retired farmers or their heirs want to continue to own farms but do not want to operate them. Limited-equity farmers are also finding that they can more easily obtain efficient operations by renting and not owning. There is no share lease that is more or less correct or suitable for either situation. The distribution of the share (50/50, 60/40, 70/30, etc.) depends largely on the agreement between the landlord and the tenant.
In some cases, the distribution agreed in the tenancy agreement is 60% tenant and 40% owner. As a general rule, most expenses are also shared. Your final distribution depends on your expectations and the agreement with the tenant. For more information on stock rentals, see agecon.unl.edu/realestate. Some flex agreements offer a fixed price per bushel, multiplied by the average yield of maize for this field. (Example of maize: 1 times the average yield, i.e. 150 bushels per hectare, produces a cash rent of 150 $US per hectare.) This relieves the landowner of the risk of marketing and production and links the rental price to the production capacity of each field, which is good for the tenant. The National Agricultural Statistics Service (NASS) and the University of Nebraska-Lincoln both have foe-lative value surveys that are published annually. Provisional data from the university survey will be published in March and final data will be published in the summer. The NASS survey is conducted every two years. Final data are usually published in early September on odd numbered years. Custom Farming Contract As part of a customized agricultural contract, the operator provides all the personnel and equipment needed to carry out tillage, planting, pest control, harvesting and planting crops for storage.
The landowner bears all other expenses and receives all harvest and USDA payments. The custom operator receives a fixed payment per hectare from the owner or a fixed payment for each transaction performed. See AgDM C2-06, Farmland Lease Annual Report Form, an example of information that could be shared between tenants and landowners in construction contracts.