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Friday, October 30, 2015

Friday Farm Question: What is Custom Farming?

In my last post about the end of Harvest 2015, I mentioned we still had 250 acres of "custom work" left to do.  As I reread the paragraph, I wondered if anyone out there knew what I was talking about, so I thought I would use this post to explain  custom farming and the other ways we farmers can farm ground.

For many years, we have headed down to Warren County to help a friend maintain his farm.  We plant it and harvest the crops for a set fee, and he and his family pay all "inputs," that means seed, fertilizer, and any other nutrients the ground might need, and they receive all the profits.  This is called custom farming.  Iowa State University defines it as "An alternative to leasing farmland is custom farming. The custom operator agrees to perform all the machine operations on the owner’s land in exchange for a set fee or rate. The landowner pays for all seed, chemicals, and other inputs, and keeps all of the crop and commodity payments."   We also refer to Iowa State's list of current custom rates when we set that price for the work we do. 

It's kind of fun to go down to Farmer Tim's and work because, unlike most of our ground, his ground is rolling with many what I would call hills to go up, down, and around.  Its's pretty crazy to see the grain cart several feet lower or higher that the auger on the combine!


Not so hilly.

Other methods of farming are:

1. Owning the land you farm.  Tall Guy and I do own ground. :-)

2. 50% - 50%.  We do this on my family farm.  50-50 means that we share 1/2 of the bills and 1/2 of the profit with my mom and dad.  We also farm on variable percentages with the ground Tall Guy's family owns. It gets a bit complicated because there is a family corporation, and the generation before TG owns ground together, but TG, Gpa, family members, and accountants have figured all the numbers out to a good working relationship.

3. Cash rent: "Cash rent lease agreements are popular because the lease is simple, the rent is fixed, and the owner is relieved of making operating and marketing decisions. Likewise, the tenant has maximum freedom to plan and develop the cropping and livestock programs. The risk and returns from changing prices, yields, and costs are all borne by the tenant." (from Iowa State).

I am a huge Purdue fan, but we usually head to Iowa State's website when we want farm information. I bet that makes Jennifer Eck Campbell, at The Farmwife Feeds and Casey Campbell happy :-)

Have an awesome weekend, a safe Halloween, and don't forget to turn your clocks back tomorrow night before you go to bed......."The goblins will get you if you don't watch out~!"

1 comment:

  1. well, i wish we had the same idealogy in india like you do... renting the farm land to people who are willing to farm... it doesnt work like that hire.... the land owners prefer hiring labor for a feeble sum and they kick the work out of the labors... its too meticulous and boring though.. to work for a landlord farm and not to get anything but a minimal daily wage out of it.... hope you continue the good work and please keep posting.... this blog has been a helpful resource of information for me..
    thank you,
    we are into dairy farming business in india... any suggestion about organizing the dairy farming will be appreciated



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