Farm Management and Ag Policy

[Brad Mills, Host]
Nebraska Extension Almanac. A recent survey of Agland values in Nebraska revealed a decline for the second straight year. While there are numerous factors for this decline, extension ag economist Jim Jansen says cash rent has also several items that determine rates, such as location, usage, and responsibilities, between owner and tenant.

[Jim Jansen, Nebraska Extension Ag Economist]
Annually, the University of Nebraska Lincoln, with the center for agricultural profitability, annually surveys, individuals working in the land industry, on current trends in the market value of land, as well as cash rental rates across Nebraska.

Recent findings from the preliminary estimates as part of the real estate survey for the upcoming 2026 survey took a look at current trends and cash rental rates across Nebraska.

As part of this survey, the University of Nebraska Center for Agricultural Profitabilities preliminary estimates, summarizes changes across the 8 agricultural statistic districts for Nebraska are more commonly referred to as crop reporting districts on average for dry land craft land, gravity irrigated crop land, center pivot irrigated crop land, grazing land, or pasture on a per acre basis, as well as cow calf pairs on a month ly basis.

Now general trends across Nebraska indicated a slight decline for crop land, which is reflecting current trends or expectations related to profitability for crop land across Nebraska.

And we also seen a slight increase across the state or a slight to gradual increase for grazing land across Nebraska, which also reflects changes in the profitability for cow calf pairs or cattle prices that some might have for this upcoming fall when cattle are pulled off the pasture and some folks might be selling calves or maybe they were eight until after the 1st of the year with doing that.

Now, the average cash rental rates reported for gravity, irrigated, and center pivot irrigated crop land assume that the landowner owns the entire irrigation system.

A patent provides a component of that, especially on center pivot irrigated cropland where they might provide either the pivot, or the power unit, we might discount the cash rents to reflect the fact that the tenant is individual responsible for ensuring, repairing, or maintaining those improvements if they own those.

And we've seen discounts around $35 to $45 an acre when the tenant provides a pivot, and also some averages from a real estate survey from back in 2023 discounts of around 10 to maybe even $15 an acre in the event the tenant provides a pivot.

Now, they irrigated rental rates.

There's upkeep associated with that, and there's also upkeep associated with grazing land, whether it's control of noxious weeds, repair fencing materials, things of that nature.

Who is responsible for maintaining those things?

Well, I think generally speaking, tenants are have the expectation when they initially rent the property that's fairly well maintained, they have good equipment and things are kept up to speed or kept up in a state that are conducive to what they're trying to do out there.

Minor upkeep might be something that can be negotiated into the lease.

Major upgrades or major concerns, getting those addressed might be an expense that we have to dive a little bit deeper into, and maybe we would discount the cash rent for the upcoming year, years to reflect a large contribution, if a tenant has the type of equipment, maybe do dirt work or remove unwanted trees or brush with, say, a large excavator, for example.

All those things are negotiable elements of a lease and something that we need to be aware of when we're negotiating leases just beyond the cash rent or when there's a cash rent due, we need to be setting up a lease that accounts for both the contributions of both parties involved when it comes to setting a lease format that is conducive to the expectations of the upcoming year.

Drought, fire damage is definitely something else that we need to consider.

And I encourage everyone to exert flexibility when appropriate to account for these events that unfortunately have impacted us.

Find more information on the Nebraska farm market, real estate preliminary estimates, including land values and cash rental rates.

That is it, the Center for Ag Profitability website at cap.unl.edu slash real estate.
[Brad Mills, Host]
For Nebraska extension almanac. I'm Brad Mills. Nebraska Extension Almanac is a production of IANR Media, and Nebraska Extension. For more information on how your university is serving Nebraskans, go to extension.unl.edu.
 

[Brad Mills, Host] 
Nebraska Extension Almanac. Just as it is extremely important to make a state and transition plans for your farm operation after you retire or pass away, the documentation will ensure that your wishes are carried out. On today's program, extension ag economist Jessica Groskoff details the documents you'll need for an estate plan.

[Jessica Groskopf, Nebraska Extension Ag Economist]
So an estate plan, you absolutely need a will, a power of attorney, a power of attorney for healthcare, and a healthcare directive, or a living will.

Those are the 4 documents.

These documents are relatively easy to put together, and they can be updated as long as you are competent anytime prior to your death.

I like to think of these as the safety net, right, of a more complicated plan.

But the base there are these 4 documents.

So let's go through what these documents do.

So will assign someone called the personal representative and what their job is to distribute your assets that pass through the will at your death.

That's their job, is to make sure that this goes to this person.

That's what a will does.

Okay?

Now, not all assets will pass through a will depending on how things are set up, but you absolutely need one, even if you have more complex estate planning tools like a trust.

Okay.

Now, the next 3 documents, the power of attorney, the power of attorney, for healthcare, and the living will or healthcare directive, I often like to think of as the documents for your sunset years.

Um, but really there any time that you cannot make a decision for yourself, if you are incapacitated in some way.

These documents will come into play.

So a power of attorney assigns an agent, and in the 1st case, that power of attorney will carry out business on your behalf.

Now, this can be very broad, or it can be very narrow, but a power of attorney is important to carry on business while you are unable to make those decisions for yourself.

A power of attorney for healthcare can only make decisions on your behalf when you are unable to make them for yourself and only for healthcare decisions.

And finally, the living will or healthcare directive is the document that says what kind of care you want.

Now, we have a few different people that we've named here.

We have a personal representative in the will.

We have an agent within our power of attorney for business, and we have an agent in our power of attorney for healthcare.

These can be the same person.

They do not have to be.

The one thing I will say about that is it's somewhat easier if the personal representative and your business power of attorney are the same because they are dealing with specifically the business until your death and then can carry on after your death.

Okay.

However, they do not have to be.

I do not like to see multiple people named to these positions.

I think you need a primary person, and if you want to name like a backup.

That's fine, but I don't want to see panels of people, right?

So if you have multiple children, I don't want to see them be co powers of attorney or co-personal representatives.

I think it's important to name one and then have a backup on there.

[Brad Mills, Host]
For more information and guidance on estate and transition planning, go to UNL Center for Ag Profitability website at cap.unl.edu. That's cap.unl.edu. For Nebraska Extension Almanac. I'm Brad Mills.

Nebraska Extension Almanac is a production of IANR Media and Nebraska Extension.
For more information on how your university is serving Nebraskans, go to extension.unl.edu.
 

[Brad Mills, Host] 
Nebraska Extension Almanac. Just as it is extremely important to make a state and transition plans for your farm operation after you retire or pass away, the documentation will ensure that your wishes are carried out. On today's program, extension ag economist Jessica Groskoff details the documents you'll need for an estate plan.

[Jessica Groskopf, Nebraska Extension Ag Economist]
So an estate plan, you absolutely need a will, a power of attorney, a power of attorney for healthcare, and a healthcare directive, or a living will.

Those are the 4 documents.

These documents are relatively easy to put together, and they can be updated as long as you are competent anytime prior to your death.

I like to think of these as the safety net, right, of a more complicated plan.

But the base there are these 4 documents.

So let's go through what these documents do.

So will assign someone called the personal representative and what their job is to distribute your assets that pass through the will at your death.

That's their job, is to make sure that this goes to this person.

That's what a will does.

Okay?

Now, not all assets will pass through a will depending on how things are set up, but you absolutely need one, even if you have more complex estate planning tools like a trust.

Okay.

Now, the next 3 documents, the power of attorney, the power of attorney, for healthcare, and the living will or healthcare directive, I often like to think of as the documents for your sunset years.

Um, but really there any time that you cannot make a decision for yourself, if you are incapacitated in some way.

These documents will come into play.

So a power of attorney assigns an agent, and in the 1st case, that power of attorney will carry out business on your behalf.

Now, this can be very broad, or it can be very narrow, but a power of attorney is important to carry on business while you are unable to make those decisions for yourself.

A power of attorney for healthcare can only make decisions on your behalf when you are unable to make them for yourself and only for healthcare decisions.

And finally, the living will or healthcare directive is the document that says what kind of care you want.

Now, we have a few different people that we've named here.

We have a personal representative in the will.

We have an agent within our power of attorney for business, and we have an agent in our power of attorney for healthcare.

These can be the same person.

They do not have to be.

The one thing I will say about that is it's somewhat easier if the personal representative and your business power of attorney are the same because they are dealing with specifically the business until your death and then can carry on after your death.

Okay.

However, they do not have to be.

I do not like to see multiple people named to these positions.

I think you need a primary person, and if you want to name like a backup.

That's fine, but I don't want to see panels of people, right?

So if you have multiple children, I don't want to see them be co powers of attorney or co-personal representatives.

I think it's important to name one and then have a backup on there.

[Brad Mills, Host]
For more information and guidance on estate and transition planning, go to UNL Center for Ag Profitability website at cap.unl.edu. That's cap.unl.edu. For Nebraska Extension Almanac. I'm Brad Mills.

Nebraska Extension Almanac is a production of IANR Media and Nebraska Extension.
For more information on how your university is serving Nebraskans, go to extension.unl.edu.
 

JayStratPlanning23 Transcript:

[Brad Mills, Program Host]
Nebraska Extension Almanac.

The volatile nature of the ag industry can make strategic planning for any operation a headache. Nebraska extension ranch management specialist Jay Parsons says successful operations have a solid foundation of planning, as well as good decision making under pressure, on today's almanac, he talks about how strategic planning can help producers chart a plan to success.

[Jay Parsons, Nebraska Extension Ranch Management Specialist]
Well, surprisingly, a lot of the stuff hasn't been done in the U.S. As far as studying producers implementing strategic planning and whether or not they're doing it successfully.

So at least the studies I was able to find were pretty much overseas or up in Canada.

So Peter Nuttall out of New Zealand's done quite a bit of work looking at managerial abilities of ag producers and different aspects of that.

And his survey, he was asking producers to rank, different attributes, that they think are important for management.

And surprisingly, having a clear vision of their missions and objectives and goals, uh, ranked, kind of in the middle of pack. Who's about 6 on their list of 15.

I think that they ended up ranking.

But things that were at the top were things that we'd expect to be there.

Like the ability to basically read the tea leaves, right?

See where the markets are going, see what's happening out there and reacting accordingly, where the type of things that made the top five.

And then there were some out of UK.

And, um, there was a study there on just general small businesses, small family uh, businesses in rural areas, um, and then uh, one that they looked at the actual uh, farmers themselves and uh, things that they uh, ranked up there.

It pretty much, you know, comes down to goals and objectives, right?

It's kind of the take-home point of things that they pointed out in there.

Um, you know, other things that you could do, like SWAT analysis, you know, strength, weaknesses, opportunities and threats and stuff like that kind of kind of weigh in there a little bit, but a lot of producers don't get to that level of it.

But they at least, I think one of the studies, there was 3 quarters and the other one, maybe 2 thirds, that actually said that they had a clear understanding of their goals and objectives.

Surprisingly, well, maybe not surprisingly.

Very few actually had them written down.

So it's more like 10 or 15%.

Just general planning tools, right?

So, so, you know, you think of crop farmers or crop rotations, you know, where they're going to put their crops in what years and how those rotations might work, same thing on the on the livestock side with grazing management plans and stuff like that.

That we might think of more traditional production planning tools.

Those are also part of your strategic plan, right?

Because a lot of times it has to do with basically machinery replacement decisions or machinery purchases, land, management decisions and so on.

So all of those are part of an overall strategic plan.

But then certainly cash flow projections and things like that, the financial side of it weighs in there too.

For the most part, people, you know, and Agar try to build their financial positions or their equity position.

So having good, you know, financial statements produced on a regular basis and just kind of goals of different metrics that you're trying to reach each year is important.

Farmers or ranchers spend a lot of time producing, right?

So they're sometimes they're on tractors, sometimes they're out on a horse or at a pickup or whatever.

And they think about things that they want to accomplish on their operation virtually every day, you know, several times a day.

Um, just take some time to think about some timelines.

You know, what is it?

How would I measure progress towards these things I want to accomplish?

And then take, you know, some time to write some stuff down.

You got to start someplace.

So you never really know what the key metrics are until you start thinking them through, right?

What is the right way to measure that I'm actually growing my business in the direction that I want it to go, reaching, uh, if you're wanting the next generation to take over, what kind of planning goes into that in terms of of getting those uh, young folks involved in the operation and finding a place for them to uh, operate and function and grow as a manager within the operation.

Lots of different things like that that you can think through and where you want your operation to be in five, 10, 15 years, and then just, you know, lay out some things that you would use to measure that you actually make in progress.

[Brad Mills, Program Host]
Today's program was a portion taken from a recent farmcast podcast offered by the University of Nebraska Center for Ag Profitability to hear the entire interview, go to cap.unl.edu or download from Apple iTunes. For Nebraska Extension Almanac. I'm Brad Mills. Nebraska Extension Almanac is a production of IANR media, and Nebraska Extension.

For more information on how your university is serving Nebraskans, go to extension.unl.edu.
 

[Brad Mills, Program Host]
Nebraska Extension Almanac

For the second year in a row, Nebraska's Ag land value has declined according to extension Ag economists, Jim Janssen. Those values reflect differently according to location and how the land is used. He talks about some of the key factors. Affecting AG real estate values. So in the state of Nebraska, the University of Nebraska Lincoln annually surveys land industry professionals across the state to evaluate changes in land values as well as cash rental rates.

[Jim Jansen, Nebraska Extension Ag Economist]
As part of recent findings from the University of Nebraska Lincoln Center for Agricultural Profitability. Farm real estate market survey and report findings indicated that the overall market value of land decreased approximately 1% to an average of $3,905 an acre, which is about 1% lower than the prior year.

With that being said, the market value of land is composed of two, uh, land classes you might call. One land class is a crop land side, whether irrigated or dry land, crop land. The other type of land is, uh, grazing land and hay land roughly half, a little over half the state is in grazing land or hay land.

The other half is cropland. Now what was reported and some of the trends indicated is the trends in the market value of land are actually reporting the profitability or the profitability expectations surrounding crop land versus grazing land. For example, the average market value of crop land declined slightly one to 2% for dry land cropland with or without irrigation potential, and maybe even a little bit more than that for the irrigated, for center pivot or, or, um.

Gravity irrigated cropland, which those declined about two to 3%. Now, for grazing land, which the profitability is a little bit different for the cow calf folks, or at least the expectation is that prices are fairly high and expectation. We might see fairly favorable prices for the fall of 2026 when one might consider selling cattle, or maybe after the first of the year if you choose to hold them that long.

We've seen an increase anywhere from five to 7%. Now that reflects a lot of a difference in the market value of land. So it's important when we're talking about the market value of land, what type of land are we reporting on, and also what area of the state are you in? Differences in the presence of livestock, even on the crop land side, when folks are having a good year on the, um, cattle side of, uh, cow calf peas.

Or if you're in the feedlot business, you might see some of those values get reflected in. Potential buyers buying land or evaluating land purchases in an area. So for the upcoming year, things to be keeping an eye on is where interest rates headed. That influences the cost of long-term borrowing, where input expenses headed seed, fertilizer, chemical on the cropland side, fuels also in consideration even for the cow calf folks.

And herbicide, yes, on if you raise hay or. Got, uh, grazing land, you might use various, uh, types of herbicides for things like that. And also the price of seed if you're on the cropland side, where, where's profitability headed. So we have to keep an eye on that. And obviously we're having a lot of challenges right now related to fire damages on, uh, some of the acreage that was unfortunately, uh, burned in the western part of the state.

What does recovery look like for that? And also what does profitability look like for the cow calf folks? So there's a lot of things to be keeping an eye on and unfortunately it looks like this year might be a dry year, and hopefully I'm wrong in saying that. And we start getting adequate moisture. I think everybody is short moisture to some degree, and, uh, small rainfall of any amount at this point would definitely help some of those folks in their recovery efforts.

Or even if you're on the grazing land side, uh, helping get some of that spring vegetation started growing. That'd be very useful. So to find more information on the Nebraska Farm Real Estate Market Survey and Report, visit the Center for Agricultural Profitability website at cap.unl.edu/realestate, no space real estate in one word for Nebraska Extension Almanac.

[Brad Mills, Program Host]
For Nebraska Extension Almanac, I'm Brad Mills, Nebraska Extension Almanac is a production of IANR Media Nebraska Extension. For more information on how your university is serving Nebraskans. Go to extension.unl.edu.