Ken Rahjes talks cash vs crop share with Mykel Taylor скачать в хорошем качестве

Ken Rahjes talks cash vs crop share with Mykel Taylor

Joining us is Dr. Mykel Taylor, Ag economist at Kansas State University. She was one of the presenters at the Risk and Profit Conference that took place virtually this year. Dr. Taylor, always great to talk with you. Dr. Mykel Taylor: Yes, it's great to be here. ` Ken: Okay. Now, typically, we talked to you about land values and all those type of things, but looking maybe a little bit different in your presentation to those that took in the seminar, that's dealing with cash rent versus crop share. Looking at those who subscribed to the Kansas Farm Management Association, those members-- Before we get into it, maybe give us that the 3,000-foot look at the whole scenario there. Dr. Taylor: Sure. What's interesting about Kansas and leasing is that a solid 40% or so of our land is leased from somebody who doesn't operate that land themselves. The typical Kansas farm is going to be made up of about 60% own land and 40% leased land. That leased land component is really important for understanding how that arrangement is made, and what kinds of risk factors come into it. That's where we look at that cash rent versus crop share because we have both types of leases in the state. It tends to be a matter of preference by the tenant and the landowner as to which type of contract they end up coming out with. Ken: Did the research or the numbers show that as we continue to see an increase in those fall crops, especially really the amount of corn acres we're seeing, is that the rotation that that maybe change the mix of crop share versus a simple cash rent? Dr. Taylor: I would argue it's more driven by the volatility and profits that we've seen over the last 20 years. It does correspond to a change in planted acres in corn, but I think that the driver is more that as we were going through that period from 2008 to 2014, where we were making really good money, there was a lot of competition for land. It is easier for a farmer to come in and outbid a neighbor farm on a cash rent than it is for them to try to outbid on a crop share because with a crop share it's hard to be real you know say, "I'll get you more money for your one-third or for your 40%." It's a little trickier there. We actually saw more use of cash rent leases during that period of high competition for land. Then starting in about between 2011 and 2016, we actually saw a decline in the use of fixed cash rents, and more used in crop share. I think that's due to the fact that the volatility in the market, the volatility, and profitability all of a sudden started becoming much higher. You had a lot of farmers who were just looking at that situation saying, "I'd rather crop share than try to do this on a fixed cash basis." Ken: Dr. Mykel Taylor a K-State Ag economist is joining us, and she was recently one of the presenters at the K-State Risk and Profit Conference. Let's take a break. We'll come back and continue this conversation in just a moment.