Posted 3/24/2015 10:39 (#4473717 - in reply to #4472986) Subject: Crazy Cash Rents is the BIG issue here
Iowa
IMHO ridiculous up front cash rents being thrown around the last 3-5 years is what is causing a lot of people stress right now. Especially after reading some of these posts. I won't lie it has stressed me out a few times also as I have had to compete against some of these offers on existing ground. Taking a spreadsheet in and showing costs to landlords still doesn't make them understand why you can't pay them anywhere close to 350.00 rent this year like Jack, Jim, or John will. I am more than happy to give the landlords those amounts but only when a flex rent agreement kicks it out. NOT up front. For the guys who in their heads think it is smart to lose money on one piece of ground (and to dollar cost avg across some of their owned or cheaper rented ground) just so they can have their brand new lineup of equipment around longer need to actually think about what they are doing. Would you rather work for yourself or John Deere or a bank?
Problem is landlords expect higher than justified rents now and it isn't going to change over night. Yes we have all negotiated the best we can I am sure and we are trying to cut costs like everyone else....but the so called free market of fertilizer has had the final say going into 2015.
Would it be helpful for the fringe acres to go away? Yes. Will it happen overnight...unfortunately no. The issue with us I states is we don't really have a lot of other options so we will stay corn and beans. Maybe more hay will get mixed in now.
Trying to Understand the thinking behind this
