If you owned a house valued at $1 million, would you rent it out with no stipulations, no written lease, and no demands on how the renters would care for your investment?
Of course not, that wouldn’t make much sense, would it? Yet that’s exactly what’s being done with thousands of acres of farmland owned by absentee landowners. Consider this: you own 160 acres of farmland and the average value per acre of that land is $7,500. That means your land is valued well in excess of $1 million!
Yet, with land that’s valued at well over a million dollars, more than that very expensive house, there’s very little oversight from absentee landowners. A recent survey shows that 27% of absentee landowners rely solely on their farm operator or farm manager to make conservation decisions. While it’s a good idea to consult with them on farm decisions, it’s important to be engaged in the care of your land, the same way you would want to be watchful of how an expensive house would be cared for by a renter.
The same holds true when you consider long-term maintenance needs. When you think about improving the value of a rental home, there are many things that you can do. You can consider painting, putting on a new roof, remodeling a kitchen, upgrading a basement, installing new windows or energy efficient heating and cooling, and much more.
But when you own farmland, you’re more limited in what you can do. There are really only three primary things that will improve the value of your land.
- The first is tiling. Tiling has been proven over the years to increase productivity and long-term profits on wet soils that need better drainage. While potentially improving yields, tiling can also have negative environmental impacts such as loss of natural wetlands and an increase in loss of nitrates through tile drains. It’s a crop improvement practice rather than a conservation practice.
- The next best thing you can do for long-term production is to protect your land from soil erosion. You want to make sure your topsoil stays in place, stays healthy and stays productive.
- Finally, you can improve the fertility of your land by maintaining optimum nutrient levels in the soil.
If you’re part of the 90% of absentee landowners who want to pass their land on to their heirs, you need a list of maintenance or improvement items for that million dollar farmland just as you would have for a million dollar house. If you inherited land that had conservation practices applied by your parents, for instance, those older conservation practices may not be capable of doing their jobs any more. Existing conservation practices like terraces and grassed waterways that are already in place, may need to be maintained to keep them in working order.
The best way to protect your asset is to rent your land to a real conservation farmer; and not someone who just claims to be conservation farmer.
Precision Conservation is a blog by Tom Buman with the intent to discover, uncover, and promote new technologies in targeting, planning, and applying soil and water conservation at both field and watershed-level scales. Join Tom in a weekly discussion of how and why both private and public sector conservationists can and should aim to apply conservation practices in the right place, at the right time, and at the right scale. Tom is founder and CEO of the Iowa-based small-business Agren.
About the Author:
Tom Buman, CEO, Agren
Tom has over 30 years of experience in soil conservation planning and is widely recognized as a passionate visionary and thought leader, and has served as Agren CEO for the past 21 years. Responsible for driving business development and strategic partnerships, Tom is highly regarded for his creativity, innovation, and commitment to developing solutions to further soil conservation implementation.
Agren helps ag retailers offer soil and water management services as part of their existing precision platform. With 20 years of experience in agricultural and environmental consulting, Agren is uniting ag technology with proven soil and water management practices to meet the rising demand for sustainably-sourced commodities.