How many farmers own their land or rent it? – Ag Fax

Data from the Illinois Farm Business Farm Management (FBFM) Association provides insight into rental arrangements in Illinois. Table 1 contains summary data for Illinois grain farms registered with FBFM.

These farms derive most of their farm income from grain farming and cultivate at least 500 acres. While this data is representative of commercial grain farms in Illinois, it is not a statistical sample of all commercial grain farms in the state.

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For the year 2021, farmers registered with the FBFM owned 23% of the land they cultivated, shared the crops 30% and rented in cash 47% (Table 1). For crop sharing agreements, farmers and landowners share the income and expenses associated with farming.

For cash lease agreements, farmers pay landowners a cash payment and receive all income and pay all operating expenses of operating the land. Variable leases in cash are classified as leased land cash in this analysis.

There has been a slight but continuous change in the types of leases, moving from sharecropping leases to cash leases. From 2017 to 2021, the amount of shared cropland increased from 33% to 30%, while the amount of land leased in cash increased from 43% to 47%.

There has been the perception that most land that is not owned by farmers is leased in cash. Although there is more leased land than shared crops, there is still a significant amount of farmland leased under a crop sharing arrangement.

The last year that more farmland was shared relative to rented money was 2006. Since then, there has been more land rented money than harvest shared.

The amount of land leased under a crop share or cash annuity varies by geographic region of the state. For example, in 2021, farmers in northern Illinois leased 64% of their land with cash and their crops shared 17%, while farmers in central Illinois leased 46% and their crops shared 40%. Farmers in the downstate rented 44% of their land and their crops shared 33%.

The amount of land owned by farmers also varies by geographic region of the state. Farmers in southern Illinois own 22% of their land, while farmers in central Illinois own only 14%. Northern Illinois operators hold 19%.

From 2017 to 2021, the amount of land held by farmers remained the same. Statewide, farmers owned 23% of their land in 2021. Farms continue to grow and farm operators make up a large percentage of farmland buyers, but the relationship between the amount of land owned by farmers and the total area of ​​cultivated land has not really changed.

When you divide farms by management yields or economic profitability, there are some differences between the top third and the bottom third for different regions of the state. Economic profitability is based on accumulated net income, but showing a charge on unpaid labor and using interest charges for non-land and land property instead of interest paid.

In Table 2, the ten-year average of the top third, bottom third, and difference is shown for the same three regions as in Table 1. In general, the top third group for management returns had less land and crops shared more acres.

For example, in central Illinois, with high productivity ratings, the top third group owned 8% less, harvest split 14% more, and money rented 6% less than the bottom third group. . Central Illinois differed from northern and southern Illinois in that the upper third rented less percentage of acres than the lower third.

This difference is primarily due to the fact that the largest percentage of shared cultivated acres is in central Illinois.

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In Illinois, the percentage of acres that make up a farm differs from north to south. There are more cash leased acres as a percentage of farmed land in northern Illinois, more percentage of shared acres in central Illinois, and more percentage of owned acres in southern Illinois. ‘Illinois.

These differences are due to the productivity of the soils, the types of exploitation and the different crops or practices for these regions. When we look at the differences between farms that are in the top third of economic profitability, these farms tend to own less land and crops share a higher percentage of those acres on their farm than the bottom third.

Every operation is different and understanding the true economic returns of each mode of land control helps to understand the impact of adding each type. Good record keeping and analyzing your trends over time helps to gain this understanding.

The author would like to point out that the data used in this study comes from the Illinois Farm Business Farm Management (FBFM) Association. Without their cooperation, information as complete and accurate as this would not be available for educational purposes. FBFM, made up of more than 5,000 farmers and more than 70 professional field staff, is a nonprofit organization available to all Illinois farmers.

FBFM field staff provide farm advisors with computerized record keeping, farm financial management, business entity planning, and income tax management services. For more information, please contact the FBFM State Office located in the University of Illinois Department of Agricultural and Consumer Economics at 217-333-8346 or visit the FBFM website at address www.fbfm.org.

Bradley Zwilling

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