Farm Table says:
Custom farming can provide an alternative to leasing. This model is often attractive to farmer owners who don’t want to invest in machinery or if they are fully employed off-farm/retired.
In this situation, the operator agrees to perform all machinery operations on the land for a set fee/rate. The owner of the land pays for all inputs including seed and chemicals and retains all the crop and commodity revenue.
This option has a different risk profile to leasing. In a good year, profits from custom farming will be smaller than under a conventional lease, but this is a common trade-off for reducing risk. However, it is an attractive option for an operator as little additional operating capital is needed and a fixed return is available.
It is advised to prepare a written contract, setting the payment rate, understanding insurance coverage.