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Risk and complexity slow adoption of flexible farm lease agreements

Many landowners seem hesitant to use flexible lease agreements.

University of Minnesota Extension educator Nathan Hulinksy says there’s concern about risk.

“The idea of sharing some of that profit and loss with the cyclical agricultural economy that we have (is the purpose of flex leases). The downside is you don’t know that bonus check amount until post-harvest because it’s dependent on yield.”

He tells Brownfield that often means waiting longer for payments.

“And the other downside with the flexible rent leases is they are a little bit more complicated than a straight simple cash rent lease.”

Hulinsky calls flex leases a good idea but says the reality is they are not catching on like he thought they would.