Second crop rental

Asked October 23, 2014, 10:21 AM EDT

I rented a field from a farmer in order to plant forage oats after he harvested his wheat. What would be a fair price to pay him. He benefited from the spray down, and good fertilizer application of 30-20-40 at 160#'s to the acre.

Huntingdon County Pennsylvania

1 Response

Asking how much is fair to pay is a decision best made before an agreement is reached. This way; if either party is not happy with the figure - we do not proceed and no one is disappointed later on.

You mention the benefit to the landlord. What was the benefit to the tenant? I assume the oats are doing, or did, well and expect the oats took off most of, if not more than, the fertilizer that was applied.

Most often the only way to calculate a reasonable land rental rate is the ask local farmers what they would pay for this piece of property. Kind of like a competitive bid. Because if no one wants the ground is has no rental value.

Many times this decision should consider a "good neighbor" policy as well as land stewardship practices.

A few resources that may help you in making this calculation include:

http://extension.psu.edu/plants/crops/news/2014/05/review-of-custom-machine-and-building-rental-rates-available-1

http://extension.psu.edu/cumberland/news/2011/cash-rent-with-bonus

http://extension.psu.edu/animals/dairy/news/2013/it-pays-to-know-your-costs