County land rent survey shows costs stabilized at $200 per acre

The 2018 local land rental survey shows rates in Fillmore County averaged between $195.42 and $207.46/acre, which indicates long-term trends in local data have stabilized at about $200 per acre since around 2014, according to Michael Cruse, U of M Extension educator.

Survey responses for 2018 land rent ranged from $20 to $379/acre. The predicted average for 2019 land rental rates is between $191.39 and $203.25/acre, noted Cruse. These values are based on 88 returned surveys.

“The results presented here are intended to be used as one piece of the discussion during land rent negotiations, not as specific values suggested by Minnesota Extension. Individual parcels may warrant a land rent value above or below the presented average based on production potential, tenant and landlord relationships, economic goals, and other factors,” said Cruse. “It is the responsibility of the landlord and tenant to consider all of these factors when negotiating land rent agreements. Please remember that Minnesota Extension does not advocate for one agricultural group over another. We are an unbiased source of information and we strive to help all agricultural parties.”

Workshops set in area

For those interested in learning more about current land rent trends, Cruse encourages people to attend one of the land rent workshops being held by University of Minnesota Extension. The closest meeting is in Preston at the Fillmore County Office Building, 902 Houston St. NW, at 1:30 p.m. on Friday, Dec.7.

These free meetings are designed to help both landlord and tenant negotiate the largest input cost the farmer has – land rent. Negotiating a fair rental agreement that satisfies the land owner and the farmer is a challenge, said Cruse. David Bau, and Nathan Hulinsky, Extension educators in ag business management, will provide several ways, by examples, factsheets and worksheets to determine a fair farm land rental rate for both parties.

Topics covered at the meetings will include local historic and projected farmland rental rate trends, current farm land values and sales, a worksheet that will help determine a fair rental agreement.  Input costs for 2018 will be presented along with current 2018 corn and soybean prices.  Worksheets will examine 2019 costs and what is affordable rent that a farmer will be able to pay in 2019, the rate of return to the landlord at current market values and examine flexible rental agreements. Attendees will receive several informative worksheets and factsheets that will help to determine what a fair 2019 farm land rental rate is.

Other area meetings will be held at: St. Charles: City Hall, 830 Whitewater Ave., at 9:30 a.m. on Dec. 6; Caledonia Auditorium, 219 E Main Street, at 1:30 p.m. on Dec. 6; and Rochester Heintz Center, 1926 College View Road SE, room HB117, at 9:30 a.m. on Dec. 7.

For more information contact Cruse, Extension educator in Houston and Fillmore counties at 507-725-5807 or 507-765-3896, or Jake Overgaard, Winona County Extension educator at 507-457-6440.