Leasing and Share Farming Land Fact Sheet

GRDC - GRDC Factsheet

Type: PDF
Knowledge level: Intermediate

Farm Table says:

Handy table on the impact of scale on machinery costs.

Leasing and/or share farming are models that can provide an opportunity to expand your business and provide an alternative to consider rather than buying additional land. Expanding your land base can be an effective way to reduce the cost of production per hectare. Economies of scale can be gained as overhead costs in particular are spread over a greater land base.

Leasing land and share farming have different risk profiles and have a range of advantages and disadvantages for each party. Risks are shared by both parties in a share farming agreement and in a lease agreement, the lessee takes on production and market risk.

The fact sheet outlines the importance of preparing a budget, ensuring you can access sufficient working capital before entering into a lease agreement, understanding your tax implications, valuing the lease and having a written lease agreement. A useful leasing and share farming checklist provides a guide to understanding the details of the land, timing, financing and legal processes.

2014 - Australia - GRDC - GRDC Factsheet
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