B4o—Lancaster Farming, Saturday, February 27,1982 How much is too much? How much should farmland rent for this year? That’s a question on the minds of many landowners and land ren ters. The owner who asks too much will have trouble finding a tenant. On the other hand, if he doesn’t ask enough he loses potential income. These days it seems to be an owner’s market with plenty of farmers available to bid for good cropland, the investor or retired farmer can pick and choose among renters and can get a rental sum that appears quite attractive. So the risk of land renting seems to be on the tenant who must pay a fairly high land charge, then meet all the other expenses of putting in a crop with little assurance of yield or price. If he has a good year, he makes some money. But if the spring is too wet or the summer too dry, he can lose his shirt. That’s the gamble farmers take each year betting against weather, insects, diseases, that they can produce a profitable crop. A few years back there were a lot of sharecroppers farmers who tilled the land on shares with the owners. It used to be common practice for the tenant to provide everything but the land and get DABRYMEBVBI WHY SHOULD YOU PAY MORE? LIMITED TIME ONLY 1 __ 1 ITEM Expires April 30,1962 i no Send order form />6iSUve3loc!HruQS P.O. Bo a 9101 Canton, OH 44711 P.O. Bok 701 Q p| oaso Se nd Sava on hundreds of other Des IVloineS, | ’W I free 60 Pago popular name brand Animal 1A 50303 ] ' Catalog Health Products , . , | You've just found the BEST PLACE We reserve the nght 1.. ~ „ . _ , _ ... to limit quantities. | to ° U Y your Veterinary Drugs & Supplies! Farm Talk Jerry Webb two-thirds of the crop. If he was a good farmer and the weather cooperated, both he and the owner made out pretty well. In this situation, the owner shared in the risk and the tenant didn’t have to cough up hard money at the beginning of the crop year. Gradually that custom changed to one where owner and renter shared certain production costs like seed and fertilizer and then split the harvest 50-50. But the sharecropper arrangements are pretty much gone in this part of the country. Owners want a guaranteed income and renters seem to prefer that also. The big question becomes bow much rent is appropriate? And, of course, there are two ways to look at the question. From the owner’s point of view, the rent must be enough to yield some income on his investment beyond taxes and a lair rate of interest on the money in vested or the value represented in the case of land that’s been in the family for years. The renter, on the other hand, can’t pay too much or he loses, money. He estimates crop yields and prices, subtracts estimated I Please send the following: SIZE PRODUCT ftalfmyc/n^ S 9m m. j QmtoiKr /m.mowm.y me j Name | Address ! Box the thousands save with livestock dings SHIPPING POINTS loines j k. an,on <^Pf>OHIO »rder form below or call TOLL FREE iwide 1-800-321-0235 Ohio 1-800-362-9638 FINAL TOTAL UNIT PRICE QUAN *?& Towi production expenses, u fa u>. t. badly be needs the additional au. cs and comes up with a figure. But then he has to compete with other farmers who may want additional acres even more than he does. So they bid up the price. Reports of land renting for $5O, $6O, even $OO an acre are common. Land that rented for $25 an acre a few years ago is snapped up at triple that amount. Are landowners gouging ren ters? Not necessarily. You see, depending on what an investor actually paid for that land, he may have to get $75 to pay his interest and taxes, and that leaves nothing to pay off the principle. So to make it a worthwhile investment, he needs to get even more rent, or wait tor rising land values to bail him out when he decides to sell. The real paradox in this mess is that, depending on the productivity of the land, the renter may not be able to pay that much rent and make any money. So what happens? The renter pays a little more than he should to get the land and hopes for good weather and high yields; the owner John Deere 225, iSo OHset Disk Harrow (Demo) Bush Hog 1437,12'6 Tandem Disk Harrow Bush Hog 146, 12’2" Offset Disk Harrow Bush Hog 245,13’6 Offset Disk Harrow Dunham Lehr Model 42319 Wing Packer Dunham Lehr Model 41300 Cuitimuicher Bush Hog Soil Hog, Disk & Chisel Plow, Min. Till John Deere 7000 4-Row Wide, Mini-till, Liq. Fert John Deere 7000 4-Row Wide, Mini-Till Liq. Fert., Less Pump.. John Deere 1300 6-Row, Dry Fert. with Monitor John Deere 1300 6-Row, Dry Fert. Less Monitor CIRCLE YOUR CALENDAR! Customer Plonter Service School! Ca9B For Reserved tons By March 15th CHAPMAN EBWNT GENIES, «c. Corner of Ruppsvilie Road & Chapman Road, Wescosviile, Pa. 215-398-2553 Open Monday to Friday 8 to 5; Saturday 8 to Noon settles for enough to pay interest and taxes or maybe even less and waits till he sells the land to get the big payoff. What this situation means is simply this farmland in this area is overpriced for agricultural purposes. With today's commodity prices, a fanner can’t buy land and pay for it with crop yields. An investor can’t buy it and expect to pay it off with rent. And a renter can’t continue to pay higher and higher rents just because land prices keep going up. There comes a tune when he must back off do a better job of farming the acreage he has and not try to be the biggest operator around. The economics of big farm machines require large acreages. But that may not be every far mer’s answer. When the rent payment takes all the profit, there’s no point in large-scale farming. Where’s all this headed? To a system of controls that will take prime farmland out of the speculation market. Farmers will sell development rights to their farms to the government. That will More h 17 of 7 PM John Deere 1600,16’ Chisel Plow Oliver 6-16 5-Bottom Auto. Plow MM 5B Spring Trip Plow John Deere F93IH, 16’ Spring Tooth w/Carrier John Deere 210,11’6 Disk Harrow John Deere AW 11’6 Disk Harrow . International 31512’ Roller Harrow New John Deere 7000 Con servation Planter John Deere 1240 Plateless John Deere 1460 Plateless, Liquid John Deere 1250 Planter, John Deere 494, Dry John Deere 494 A, Narrow, Dry John Deere 494, No Pert. AC 4R & 6R, No Till Planters White 5400 4 Row Wide or Narrow •5500 *5500 *2950 *2503 lock their property into farm forever and will adjust sel prices and rents down to the fan potential as an agricultural unit. This is already happening in few states. Many farmers ai supporting the idea as the on! sensible way to keep good farms i production and to stop the sprea of nonfarm development into th country. SADDLE UP! To Better Equipment... Find If In Lancaster Farming's CLASSIFIEDS! Tillage tylpuient! Planters! « 4 Row • 6 Row e 8 Row • 12 Row MARCH SMTW T F S - 12 3 4 5 6 7 8 9 >lll 12 13 14 15 16THJ18 19 20 21 22 23 z*T 25 26 27 28 29 30 31 - - - USI iUUnj m’ 1982
Significant historical Pennsylvania newspapers