The information highway...and farming
My family owns a farm in Stoddard County, Missouri that has been in our possesion since my Great Grandfather migrated from Germany and made it his home. For the last two generations we have had great tenant farmers, partners really, who share with us the profits, good or bad, of their efforts on our land. Now, finally, this family no longer has anyone interested in taking over the duties at the farm, so we are at a crossroads. Sell or find another way to keep the farm going.
Without "share cropping" partners, the only other option is to do a full lease of the land to a farmer willing to pay rent to work it as his own. Luckily our departing partner has a neighbor amenable to this arrangement and he has presented us with an offer to lease. The problem is, not being attuned to this kind of arrangement, we were completely at a loss to determine if the offer is good, bad, or ugly. I needed to find someone who is experieced in this sort of transaction.
So..to the internet. Opting to start with a real estate firm, I Googled up *real estate, Stodard County, Missouri*. Several names popped up. I perused several webpages, but none looked liked they had what I wanted. However, there was one of those ubiquitous Google ads on the page.....for a bank in Dexter Mo. the site of our farm. It occured to me that in small towns, the bankers know everyone. Pow/Click.....I go there and view a list of names and phone numbers. I call for one of the bank V.P.'s but the secretary tells me he is not in, but would I like to speak to the President. Sure. The Prez is a very affable fellow, and when I describe my question he relates that they are really not in the agricultural lending business, but he knows someone who is. He gives me the phone number to Mike Pobst at the Alliance Bank in Sikeston, Mo. another small town near the farm.
Mike, Senior V.P.-Ag Lending, is my kinda' guy. A bubba banker. I pose my question to him...."do you know anything about farm leasing rates in the area"? Mike gives me a chuckle, and says that he grew up on a farm, worked on a farm until he graduated from college, his family still owns a farm in the area, and he's been lending money to farmers for over 20 years. He proceeds to give me the "Farm Leasing for Dummies" short course. What are you raising? If it's corn you should get more per acre.....corn prices are good. Are you raising soy beans? You get less money. Irrigated land brings "X" percentage more. Mike reckons that our deal with irrigated and non irrigated land and raising soy beans, wheat and some corn is mostly a fair deal, but he'd go for a three year lease instead of a five year deal. Three years is enough time for the leasee farmer to amortize his costs in his fertilizer program.
Damn. Mind you this whole process took approximately one half of an hour. Back in the old days, BTI [before the internet] I suspect I would have had to go to Stoddard County, Missouri and spend three days to learn what I did in this half of an hour.......ain't the Internet great!
My family owns a farm in Stoddard County, Missouri that has been in our possesion since my Great Grandfather migrated from Germany and made it his home. For the last two generations we have had great tenant farmers, partners really, who share with us the profits, good or bad, of their efforts on our land. Now, finally, this family no longer has anyone interested in taking over the duties at the farm, so we are at a crossroads. Sell or find another way to keep the farm going.
Without "share cropping" partners, the only other option is to do a full lease of the land to a farmer willing to pay rent to work it as his own. Luckily our departing partner has a neighbor amenable to this arrangement and he has presented us with an offer to lease. The problem is, not being attuned to this kind of arrangement, we were completely at a loss to determine if the offer is good, bad, or ugly. I needed to find someone who is experieced in this sort of transaction.
So..to the internet. Opting to start with a real estate firm, I Googled up *real estate, Stodard County, Missouri*. Several names popped up. I perused several webpages, but none looked liked they had what I wanted. However, there was one of those ubiquitous Google ads on the page.....for a bank in Dexter Mo. the site of our farm. It occured to me that in small towns, the bankers know everyone. Pow/Click.....I go there and view a list of names and phone numbers. I call for one of the bank V.P.'s but the secretary tells me he is not in, but would I like to speak to the President. Sure. The Prez is a very affable fellow, and when I describe my question he relates that they are really not in the agricultural lending business, but he knows someone who is. He gives me the phone number to Mike Pobst at the Alliance Bank in Sikeston, Mo. another small town near the farm.
Mike, Senior V.P.-Ag Lending, is my kinda' guy. A bubba banker. I pose my question to him...."do you know anything about farm leasing rates in the area"? Mike gives me a chuckle, and says that he grew up on a farm, worked on a farm until he graduated from college, his family still owns a farm in the area, and he's been lending money to farmers for over 20 years. He proceeds to give me the "Farm Leasing for Dummies" short course. What are you raising? If it's corn you should get more per acre.....corn prices are good. Are you raising soy beans? You get less money. Irrigated land brings "X" percentage more. Mike reckons that our deal with irrigated and non irrigated land and raising soy beans, wheat and some corn is mostly a fair deal, but he'd go for a three year lease instead of a five year deal. Three years is enough time for the leasee farmer to amortize his costs in his fertilizer program.
Damn. Mind you this whole process took approximately one half of an hour. Back in the old days, BTI [before the internet] I suspect I would have had to go to Stoddard County, Missouri and spend three days to learn what I did in this half of an hour.......ain't the Internet great!
