Farm Table says:
This US-based publication, written in 2011, has the following purpose:
to help operators (lessee) and landowners (lessor) make sound decisions and develop equitable crop-share arrangements.
It focuses on:
- Advantages and disadvantages of crop share arrangements
- Establishing a crop share arrangement
- Developing an equitable crop-share lease agreement
- Establishing Rents For Other Cropland, Pasture, And Buildings
- Putting The Agreement In Writing
The following principles are practical and insightful:
Principle 1 – Yield-Increasing Inputs
- Variable expenses that increase yields should be shared in the same percentage as the crop is shared.
- A worked through example is provided
Principle 2 – Technology
- Share arrangements should be adjusted to reflect the effect new technologies have on costs and returns.
Principle 3 – Equitable Shares
- The landowner and operator should share total returns in the same proportion as they contribute resources
- Figure below is a simplified example showing how the value of the land affects the landowner’s contribution.
Principle 4 – Compensation For Unused Investments
- Operators should be compensated at the termination of the lease for the undepreciated balance of long-term investments.
Principle 5 – Communication