8/2/2019 F ARMLAN ARMLAND L EA SING & M & M AN EASING ANAGE GEMEN MENT W OR ORKS KSHOP HOP Melissa O’Rourke B.S., M.A., J.D. F ARM & A GRIBUSINESS M ANAGEMENT S PECIALIST Housed at ISU Extension — Winneshiek County www.extension.iastate.edu/agdm morourke@iastate.edu Office phone: 563-382-2949 The Goal? Key Topics: ► Trends in -- Farmland values • You leave here today with & Cash rental rates increased knowledge and ► 2018 Farm Bill Resources, Decisions – and confidence to assist you to - - upcoming education programs ► Costs of crop production -- resources – Review current farmland & ► Negotiating a fair cash lease rate management arrangements ► Farms & financial Stress – Take steps to plan for the future ► 2020 Farm Leasing Considerations: . . . and – Legal issues & Communication – Know where to go for resources – Conservation considerations and assistance. . . . and much more! Resources you’ll want to read & study: Page 3: Page 13: Let’s get familiar amiliar with ith you our r Far armland mland Leas Leasing ing Ar Arrangements angements book: book: 1
8/2/2019 Pages 23-28 – CLEANER Water, Nutrient Reduction: PAGE 100 Iowa Nutrient Reduction Strategy Addressing Iowa’s • contribution to Gulf hypoxia Voluntary, science-based • Cities, industry & • agriculture A practice-based approach • to show meaningful and measureable progress 45% reduction in nitrate-N and P 41% for N and 29% for P for non point sources A framework for innovation • Bioreactors remove about Benefits of meeting INRS goals? Edge of Field Nitrate 43% of the nitrate load Reduction Practices • Improved water quality in streams, rivers, lakes & local source water. • Reduced N and P loads leaving Iowa, heading to Gulf of Mexico. • Economic development opportunities -- conservation infrastructure, reduced need for treatment, improved recreation and habitat From Christianson and Helmers, 2011 Illustration by John Petersen (www.petersenart.com) Wetlands remove Nitrate Removal Wetlands an average of 52% of the nitrate load when tile water is routed into the wetland. • Wildlife habitat • Esthetic benefits • Long-term economic incentives in areas that may be marginal 2
8/2/2019 Sa Satur urated ed Bu Buffer ers • Enhancement to existing or new buffers • Must meet certain soil, slope and bank characteristics. SAMPLE cover crop lease insertion. I have a few copies – or you can find it from The Nature 3 chamber control • box Saturated buffers Conservancy: remove about 50% of the nitrate load www.nature.org • The buffer provides wildlife habitat Talk to your area Field Agronomist Pages 87-90 for information about cover crops in your book: and other strategies: Article and Terry Basol Brian Lang tlbasol@iastate.edu bjlang@iastate.edu sample 641-426-6801 563-387-7058 language for 641-435-4864 563-382-2949 conservation practices. 3
8/2/2019 ► Provides assistance to farmers & ranchers directly impacted by tariffs, resulting in loss of traditional export markets. ► Payment for non-specialty crops, dairy, hogs, & specialty crops. ► Assistance for non-specialty crops based on a single-county payment rate multiplied by a farm’s total plantings of MFP -eligible crops in aggregate in 2019. Per-acre payments are not dependent on which of those crops are planted in 2019. ► Total payment-eligible plantings cannot exceed total 2018 plantings. County payment rates range from $15 to $150 per acre, depending on the impact in that county. MFP payments will be made in 3 portions (August, late fall, winter). See farmers.gov/mfp. New Farm Bill: 2019 thru 2023 Crops • Statewide Extension meetings with FSA planned for late Fall 2019 (regional, not in every county). • ARC versus PLC Program (by crop, by FSA Farm #) – 2-Year Election & Enrollment begins in September; decisions by FSA Farm Number & Crop – PLC likely choice if National Average Cash Prices fall below $3.70/bu corn or $8.40/bu soybeans effective reference prices – A 2019 payment, if made, not received until October 2020. • PLC Yield Update – One-time opportunity, landowner decision – Updated Yields for Corn and Soybeans = Average farm yield for the 2013-2017 crop years X 81% – New PLC yields can be used starting with the 2020 crop 2019 Survey • Later today, we’ll use the 2019 Cash Rent Responses: Survey (page 37) and consider methods to set rents. • 1,262 responses • Farmers, landowners, ag lenders, and • 47% farm operators professional farm • 30% landowners managers supply • 8% ag lenders information based on their best judgments • 12% professional farm managers & realtors about typical cash • 2% other professions rental rates for high, • Respondents indicated being familiar with medium, and low quality cropland in counties for over 1.6 million cash rented acres across which they have Iowa. knowledge about • On average, that’s about 1,268 acres per multiple parcels of farmland. respondent. 4
8/2/2019 Does the cash rent survey tell www.exte ww tension.iasta tate te.edu/a /agdm you what your rent should be? ► It’s a tool that can No, nope, it sure does not. be a starting or reference point for determining an appropriate cash Get familiar with Ag Decision Maker!! rental rate for a particular farm. ► It is not intended to be the sole source for determining cash rents. Financial Analysis Farm Management Field Specialists Expertise? Lyon Osceola Dickinson Emmet Winnebago Worth Mitchell Howard Winneshiek Allamakee • Farm Financial Planning: Confidential, private service. Kossuth MO We can Cerro Sioux O'Brien Clay Palo Alto Hancock Floyd Chickasaw Gordo • Computerized financial analysis using FINPACK software. GW answer Fayette Clayton • Buena Humboldt Bremer For anyone who wants a more complete picture of farm finances. questions, Plymouth Cherokee Vista Pocahontas Wright Franklin Butler • Takes guesswork out of whether a change would increase profitability refer you to Black Dubuque Buchanan Delaware Webster Hawk Woodbury Ida Sac Calhoun Hamilton Hardin Grundy and improve cash flow. resources, Jackson • FINPACK analysis provides more in-depth evaluation, which many Jones or refer you Tama Benton Linn Monona Crawford Carroll Greene Boone Story Marshall SE SJ lenders are requiring before further credit extension. RD to someone Clinton Cedar • Helps evaluate farm business, determine whether change is desirable. Harrison Shelby Audubon Guthrie Dallas Jasper Poweshiek Iowa with the Polk Johnson Scott Mus- • Provides in-depth plan so operator & lender can make decisions. expertise catine Pottawattamie Cass Adair Madison Warren Marion Mahaska Keokuk Washington • Answers basic questions of sound farm business management: you need. Louisa CB • Where am I today? Where do I want to be? How do I get there? Mont- Mills Lucas Monroe Wapello Jefferson gomery Adams Union Clarke Lucas Henry Des • Moines Looks at profitability, liquidity, solvency, and risk-bearing ability. Fremont Page TE Taylor Ringgold Decatur Wayne Appanoose Davis Van Buren • Lee Considers alternative plans such as addition, expansion, or phasing out a livestock operation, or buying, selling, or renting land. • Evaluate ways to correct negative cash flow, profitability problems. LOCATIONS of FINANCIAL ASSOCIATES shown on the map. Clients How does it work? may travel to these locations, or may be able to arrange meetings at ISU Extension offices. What’s the cost? • Trained extension associate meets with family – farm business owners to discuss the analysis and possible effects if changes are made. • May introduce other farm and family financial materials or information about outside sources of help. • Cost?? No charge. Funded by the Ag Credit School, a program of ISU Extension and Iowa Bankers Association. • Who performs the analysis? Farm Financial Management associates are part-time extension employees with college degrees and special training in farm budgeting and financial analysis. They have farm backgrounds so they understand the current farm situation. 5
8/2/2019 • Page 99 – more information: If you want more information on this no-cost financial analysis program . . . • Talk to me – I can help you arrange the contact and meeting. • VISIT the ISU Extension website that describes the program and lists contact information: • www.extension.iastate.edu/farmanalysis/ Are you – or r some someone you IOWA CONCERN HOTLINE: know w – feeling st stress ss on on 1-800-447-1985 the the farm? m? • Available 24/7 • Free There are a • Confidential variety of • All kinds of concerns – resources financial, legal, available to family, stress- help. related Also 24/7: Resources Iowa Concern On-Line CHAT on • Just Google managing “ Iowa Concern ” Farm & and click on the link for On-Line Family Chat Stress • Available 24/7 • Free and Confidential 6
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