MSU Extension Farm Management

This calculator is intended for use in designing long-term or multi-year farm rental agreements as part of a land rent negotiation process. Estimating the yearly or long-term average rent can be helpful if cash rent is adjusted based on the crop rotation. For these scenarios, landowners and farm tenants can consider impacts to long-term rent if changes in crop rotation are required.

Farms desiring a fixed cash rent agreement can also benefit from discussions of revenue potential with crop rotations. Designing a fixed cash rent agreement to match the farm's production plans can help achieve long-term sustainability of land access.

Final rent negotiations are recommended to always consider landowner expenses and farmer cost of production needs, in addition to any other property access/use considerations.

There are two calculation options within the decision tool:

• Average Rent by Crop and Rotation - Helps to determine the average rent based on crops raised across a rotation. Information Needed:
  • Crops raised
  • Rent values by crop
• Average Rent by Total Crop Acres - Helps to determine the average rent based on crops raised and total farm acres. Information Needed:
  • Crops raised
  • Acres by crop
  • Rent values by crop

Notes:                                                                                                                                                

Production vs. Non-Production Contract Scenarios:

Production Contracts: Multiple-year lease agreements can be common in areas where crops are grown under production contracts. Production contracts can provide a higher source of revenue than commercially grown crops. Adjusting cash rent values in long-term leases to account for years when higher revenue crops are grown can benefit both landowner and farm tenant. Landowners can receive a share of higher revenue generated by their property. Farm tenants can establish a long-term plan for managing rent payments.

Non-Production Contracts: Multiple-year lease agreements can also be common for non-production contract farms. Use of multi-year planning is recommended for all size operations, regardless of how crops are marketed. Landowners and farm tenants can benefit from long-term rental agreements that consider both party needs.      

Additional Instructions:

Anything in BLUE can be edited without altering any formulas in the spreadsheet.

All values are auto calculated based on various formulas.

A "reset" macro button is provided to clear out example information.  All editable fields can be cleared manual for non-macro users or individuals using a mobile device.                          

Disclaimer: All example crops and values shown within the calculator are for demonstrative purposes only.  Examples should not be viewed as recommended rotations of crops being grown or values associated with each crop.