Search
Better Farming OntarioBetter PorkBetter Farming Prairies

Better Farming Prairies Featured Articles

Better Farming Prairies magazine is published 9 times per year. After each edition is published, we share featured articles online.


Renting Out Your Land

Wednesday, January 29, 2025

Know The Risks & The Potential Benefits

By Mary Loggan

Renting out your land to a farming tenant can have many benefits; however, being aware of the potential risks and making informed decisions about land management is essential.

What are the benefits?

Jaycee Adrian, farm management extension specialist and agriculture program specialist with the Government of Saskatchewan, says one of the most compelling reasons for renting out farmland is the potential for generating extra income.

“It is a guaranteed source of income, without having to farm the land yourself. This is a great option for farmers to still be involved in the industry, even though they may not be farming the land themselves.”

Darren Bond, farm management specialist with the Government of Manitoba says, “for farmers, the ability to receive an annual payment for land rent with an appreciating asset makes retaining ownership in the farmland an attractive scenario.”

Brenna Grant agrees, and adds an additional motive – it could be a good way to start reducing your own workload.

overview of canola field
    Enjoy Today Photography photo

Grant, the executive director of Canfax, explains that “land ownership and farming are two separate businesses. Renting out farmland can provide a steady income stream without the need for active farming. Especially during years when personal circumstances or age make active farming less viable.”

She believes “it offers flexibility and can be a strategic move for those considering retirement or downsizing.

“For farmers looking to transition out of day-to-day operations, renting out land offers a way to remain connected to the industry while easing into retirement.”

Renting out farmland can also offer opportunities to advance succession planning.

Adrian says that “allowing for the gradual scaling down of land can help set up the next generation to inherit the land.

“This allows farmers to still maintain their legacy, while transitioning into retirement.”

Renting out your farmland can also help mitigate the risks associated with farming.

Adrian points out that “there are always risks with farming, especially when it comes to crop failure. By renting out farmland, you can avoid some of these risks while still gaining income.”

What are the risks?

Renting out farmland is not without its challenges, especially considering potential disputes between landlords and tenants.

Bond stresses the importance of clear communication. He points out there are always things that can go wrong when renting out land and says having all parties on the same page is essential.

“Farmers who rent out land want to be paid a fair price, paid on time, and know that their land is being looked after properly.”

Adrian agrees. “Payment issues are always a concern when renting out land; in some cases, different payment options are essential. Often payments can even be made twice a year to help minimize risk.”

Farmers also face a certain type of risk when renting to an outside party because they are no longer directly in charge of land maintenance.

Grant warns about that “loss of direct control.”

She explains that “tenants may have different management practices. Having clear communication up-front to understand what the renter plans can help with the transition.”

Land rental agreements come with various legal and financial implications as well.

Grant says that “there could be legal and financial challenges if the lease agreement isn’t well-structured. Poorly drafted lease agreements can lead to disputes over land use, maintenance responsibilities, or payment terms, potentially resulting in financial losses or legal conflicts.”

What are the best ways to minimize your risk?

When it comes to minimizing risk, one of the most important things to consider is finding the right tenant.

“Finding the right tenant to rent your land is the key to success. It’s essential to find someone you can create a good relationship with and share clear goals regarding land planning and stewardship,” says Adrian.

Grant agrees. “Select the right tenant. Finding one who shares your values and land stewardship goals is essential. Have a clear understanding of the land’s value and a well-defined objective for rental income. Clear and active communication ensures that both parties are on the same page.

“Building a strong relationship with the tenant and regularly monitoring the land is crucial. Maintain open communication and a positive relationship with your tenant. Regularly visit the property to see how it’s being managed.”

Effective communication between landlords and tenants is vital.

Bond adds that “long term relationships built on communication and trust will result in the most success when renting out farmland.”

Again, a clearly-written lease agreement is crucial.

“Having a clear understanding of the lease agreement can help minimize risk and keep everyone on the same page.

“It is important that both the landlord and tenant agree on stewardship practices and price before the agreement is signed,” says Adrian.

Renting out farmland can have many potential benefits for farmers. However, it is always important to consider risks. Adrian points out that this can be a balancing act.

“It is always important to consider market values and how the market can change.

“Perhaps you have a good tenant; however, what if they can’t afford the increased rent as the market alters?

“Balancing the changing market while keeping good tenants is an essential factor for farmers to consider.” BF

Current Issue

April 2025

Better Farming Prairies Magazine

Farms.com Prairies News

Roquette Canada receives grain dealer license

Wednesday, March 26, 2025

A Manitoba grain handler recently received a license from the Canadian Grain Commission (CGC) On March 24, the CGC awarded a grain handler license to Roquette Canada, a leader in plant-based ingredients, in Portage la Prairie, Man. This type of license is for “a person who, for reward,... Read this article online

Lynmark Farms named Master Breeder for 2025

Wednesday, March 26, 2025

The Canadian Milking Shorthorn Society has announced that Lynmark Farms has been named as a herd for 2025. Lynmark Farms is owned and operated by Tim Shearer and Irene Vietinghoff of Norwood, Ontario. They are the third Milking Shorthorn herd to be recognized as a since this... Read this article online

Saskatchewan Names 2025 Top Young Farmers

Tuesday, March 25, 2025

Brady and Lindsay Funk of Braylin Acres Ltd have been recognized as Saskatchewan’s Outstanding Young Farmers for 2025. The honour was awarded at the regional competition held during the Canada Farm Show in Regina on March 19–20, attended by industry leaders, sponsors, and alumni. The Funks... Read this article online

Alta. dairy industry supporting youth through WHL

Tuesday, March 25, 2025

Alberta youth receiving support at Youth Empowerment & Support Services (YESS) centres will have access to local dairy products thanks to Alberta Milk. For the third consecutive year, Alberta Milk and the Edmonton Oil Kings collaborated on the $15,000 Shots for Charity challenge. For... Read this article online

International Women’s Day – Erika Stewart

Tuesday, March 25, 2025

Leading up to International Women’s Day on March 8, Farms.com is speaking with as many women in ag as possible about three topics: What would you tell your 12-year-old self about being a farmer? Advice you have for women new to the ag industry Identify a woman in ag you consider a... Read this article online

BF logo

It's farming. And it's better.

 

a Farms.com Company

Subscriptions

Subscriber inquiries, change of address, or USA and international orders, please email: subscriptions@betterfarming.com or call 888-248-4893 x 281.


Article Ideas & Media Releases

Have a story idea or media release? If you want coverage of an ag issue, trend, or company news, please email us.

Follow us on Social Media

 

Sign up to a Farms.com Newsletter

 

DisclaimerPrivacy Policy2025 ©AgMedia Inc. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Back To Top