STRAIGHT FROM THE HORSES MOUTH

Duane A. Lienemann
Nebraska Extension Educator

                                         
     What a difference a week can make! While we probably didn’t get the million dollar rains, but it certainly puts all of our crop and pastureland in a different light, for at least a little while.  There is no doubt that this moisture that we got this past week is a Godsend and is very much appreciated, even by those that had put hay down. That being said, we are still on the edge in many places in South Central Nebraska. This should help the top portion of our soil moisture, freshen the growing plants, improve the attitudes of a lot of dryland farmers and give some relief to our irrigators, but the subsoil is still critically low in many of those places that have not been blessed with rainfall. We will need timely rains now to get us to maturity and harvest. Don’t stop doing the rain dances, praying or going to Church --- we still need all the help we can get!
     Ag Pen Pal Program: There are several things I think it would be good to discuss in this edition and the first is something that is easy to do and I believe is so very important for we in agriculture who will be continually contending with the lack of literacy in agriculture or understanding of farming by consumers, and that starts with our children. I have a little vested interest in this project because it also involves my daughter, but I would support this effort regardless. Nebraska Agriculture in the Classroom is seeking farm/ranch families and classrooms across Nebraska to be part of the Ag Pen Pal Program.  The Ag Pen Pal Program helps educate students about their food, fiber and fuel through creating a personal connection between a farmer or rancher and a classroom. Farm and ranch pen pals are encouraged to write letters or emails as well as visit their classroom in person or via Skype. If you are a farmer/rancher, teacher or are just simply advocates for agriculture and am interested in being a part of the Ag Pen Pal Program, email Deanna Karmazin at deannak@nefb.org or get ahold of me and I will get you to the proper channels.  I know several people who have done this and each of them tell me that it is an incredible experience. This progressive individuals say they probably get more out of it than the young students they befriend! Here is a chance for you to both influence and to educate our future consumers!
     Land Rent Decisions: It is, of course, common knowledge to most landlords and renters alike that decisions concerning land rental agreements, lease termination (including terminating handshake or verbal leases) have a suggested deadline of August 31, 2015. That means that landlord and renters should be engaged in determining their agreements for the coming 2016 crop and grazing year. There has been a lot of discussion because of the increased value of land, increased taxes coupled with the very evident decline in crop prices which has precipitated some angst in the ag communities. 
     2015 cash rental rates for cropland for cropland declined in all ag districts. However grazing rental rates rose from 10 to 35% Monthly pair and stocker pasture rental rates set record levels. It was not a surprise to me to see that hayland prices rose 20% statewide while grazing land rose 9% for tillable land and 16% for non-tillable grazing land. Crop ground prices dropped 4 to 9% with the largest drop in dryland cropland with no irrigation potential. Also the more marginal cropland had a larger value decline than higher quality farmland. Even though land values declined over the past year, all districts and land types are higher than 5 years ago, thus the need to look at some changes that are evident in pasture and grazing rates. It has been evident that many landlords and renters alike have been changing their thoughts on renting pasture from a per acre basis to a cow/calf pair cost per monthly basis. First the drought conditions over the past several years and need for more acres of grass per pair than the normal rates helped precipitate this and now with the higher prices for stocker-feeders and cattle in general, coupled with the spike in the value of pasture and hayland has dictated that many people change their rental agreements to a monthly cow/calf pair rental rate. Let’s take a look at this change and why it is happening.
      Grazing Rates for Cow-Calf Pairs:  The recently published Nebraska Farm Real Estate Market Highlights 2014-2015 report indicates pasture rental rates for cow-calf pairs and stockers have set record highs for the second year in Nebraska even with some fluctuation. Panel members indicated the driving force behind these rates stem from record setting cattle prices along with the expectation for these values to remain high into the future. The average rental rates per month for cow-calf pairs and stockers are reported in Table 1 (http://go.unl.edu/g8ws ). A complete listing of the counties located in each Agricultural Statistics District of Nebraska can be found in the full report which are available electronically via the Nebraska Farm Real Estate website: http://agecon.unl.edu/realestate. It may be good to get a good background.
      Cattle producers across Nebraska have shown their willingness to bid up rental rates as the profitability of the cow-calf and stocker industry remain quite high. As landlords and tenants negotiate grazing rates for cow-calf pairs and stockers, both parties must keep in mind what rate would be viable to satisfy the needs of everyone involved in the transactions. Some of the common elements landlords and tenants must agree upon as part of grassland rental arrangement include which party is responsible for maintaining fences, wells, water tanks, and control of noxious weeds. Other provisions that may be negotiated include the checking of livestock and dispensing of mineral and salt depending upon the distance of the tenants operation from the rented parcel.  It shows an average rate in the South district of just short of $58 per cow/calf pair per month of grazing. Grazing rates for cow-calf pairs fluctuate across Nebraska depending upon the district. Local market forces along with inherent attributes of the ground influence the rental rates negotiated by cattle producers across Nebraska. Actual land values and rental rates may vary depending upon the quality of the parcel and local market for an area. 

The preceding information comes from the research and personal observations of the writer which may or ay not reflect the views of UNL or Nebraska Extension. For more further information on these or other topics contact D. A. Lienemann, Nebraska Extension Educator for Webster County in Red Cloud, (402) 746-3417 or email to: dlienemann2@unl.edu or go to the website at: http://www.webster.unl.edu/home