Establishing a Starting Point for Land Rent Price

Building a Rental Agreement That Works

Pasture rent – 3 Basic Methods:

1. As a general rule of thumb pasture rent is approximately 50-70% of crop land.  High quality pasture fences and water access would demand 70%, where average to poor quality pasture would only command 50% the value of crop land.

2. Pasture rents can also be determined on a per head basis which usually runs any where from $8-$20 per animal unit per month.  An animal unit is considered 1000 pounds of animal.  However, horses are usually figured at 150% because of the impact they have on pastures. For example, a large 1000 lb horse is equal to 1.5 animal units.

3. The third way to determine pasture rent is on pounds of gain.  This usually runs at a rate of $.25 – $.75 per pound.

NOTE: As per the USDA National Agricultural Statistics Service the average Cash Rent for non-irrigated cropland was $105 per acre in 2014 and pasture rent was $20.00 per acre in 2014.

RELATED LINKS OF INTEREST

Ag Lease 101

Free Lease Agreements (Midwest Plan Service)

Flexible Lease Agreements (IA State)

Selected Farm Rents, Rates, and Values