Avoid The Pitfall of Leasing Farmland With Low Fertility

Several years of low commodity prices, high input costs and thin margins have taken a toll on soil stewardship in some parts of the country. As a result, farmers need to use caution and do their homework before renting ground that’s coming available in their area for 2026.

land - aerial - Lindsey Pound
Farmers looking to rent a new piece of ground for 2026 will benefit from doing their homework before signing on the dotted line.
(Lindsey Pound)

Farmland often changes hands in the fall, and such exchanges are currently underway across the country as farmers and landlords look to finalize deals for the 2026 season. But some of the ground changing hands is in poor condition with regard to fertility, according to Ken Ferrie, Farm Journal Field Agronomist.

“I’m really shocked at how poor the stewardship is on some of these farms,” says Ferrie, who is seeing the issue in central Illinois, where he’s based. “We have seen multiple pieces of ground this fall that have been literally sucked dry of fertility and are sitting in bad shape on pH.”

While Ferrie isn’t sure how widespread the issue is, he says more farmers have reached out to him about the problem than in previous years. He attributes much of the issue to non-operating, absentee landowners who might not understand the need for good stewardship practices to keep ground productive. In other cases, he is concerned some landowners are simply interested in financial gain.

“It’s often land they inherited, [and they’re] two or three generations away from farming,” Ferrie says. “They look at it like an investment in the stock market.... In many cases, their relatives, the original landowner, would be turning over in their graves if they could see what’s happening to some of this ground.”

Conservation Practices On Rented Ground
Around 40% of all farmland in the U.S. is rented — in some U.S. counties that number is nearing 80%. According to USDA data, 283 million acres (30% of all farmland) are owned by non-operator landlords — those who own land used in agricultural production but are not actively involved in farming it.

The American Farmland Trust (AFT) reports that many non-operating landowners are unfamiliar with conservation practices or have difficulty discussing long-term goals with their renters. One survey found that 65% of non-operating landowners rely on their farm operator or someone else to make decisions on conservation practices.

“This dynamic can lead to a lack of investment in practices that improve productivity and resiliency of the land,” AFT reports. “Some of the areas with the highest rates of rental agricultural land are also those experiencing high rates of soil erosion and nutrient losses.”

Due Diligence Can Prevent A Costly Investment
Leasing land with low fertility levels can create financial hardship for unsuspecting growers. Such “hidden” costs frequently impact younger farmers who have limited resources and opportunities to rent ground.

“Many times, it’s our younger growers looking for land to expand their operation that seem to get caught up in these sucked-dry, short-term cash rent scenarios,” Ferrie says. “For short-term leases, that could be an anvil around your neck. There may not be a way to gain profitability short-term on some of these farms.”

While cash rents are softening slightly in some states for 2026, they still represent a huge investment for growers who are unlikely to see improved commodity prices to counter their investment in land and other inputs.

average cash rents.jpg
Table 1 provides average USDA cash rents across 4 land classes defined by soil productivity index (SPI). Average cash rents declined for the excellent, good, and average land classes while average rents slightly increased for areas classified as fair. Table 1 also provides average cash rents by land class as reported by the Illinois Society of Professional Farm Managers and Rural Appraisers (ISPFMRA). Average rents on professionally managed farmland tend to be higher than the averages reported by USDA.
(USDA and others as noted)

Ferrie’s advice for farmers looking to pick up more ground: do your homework thoroughly before signing on any dotted line. Here are three steps he recommends farmers take as they consider renting new ground for the year ahead:

1. Avoid making assumptions. “Don’t assume just because a piece of land is being managed, that stewardship is being followed,” Ferrie cautions. “Farm managers work for landlords/owners. If they want the farm taken care of so it can be passed down to future generations, they’ll make it happen. If the landlord wants the highest return without any regard to stewardship that, too, is the farm manager’s job,” he explains.

2. Ask for current soil tests and yield maps. That will provide some insights on how the ground has been treated and its general productivity.
“If the leaser is not supplying any information, talk to the neighbors, if possible. Ask whether they ever see a lime truck on the farm,” he says.

Another option is to ask the leaser if you can pull some spot soil samples to get a feel for fertility in the field.

“If the answer or situation is no, ask about a conditional lease based on soil fertility levels once you do get the field tested,” Ferrie advises.

3. Gather information about past practices on the ground. For example, Ferrie says if you no-till, you’ll want to evaluate whether there are horizontal layers present in the field.

“I’ve seen in many situations where the No. 1 hurdle is removing compaction layers left by the previous tenant,” Ferrie says. “If you rent the ground, you’ll need a plan with your agronomist on how to address that.”

Different Factors Influence Farmers Who Are Buying Land
Ferrie points out that poor soil fertility across a parcel of ground might not be as concerning for farmers who are purchasing the property.

“I’ve been told by more than one realtor and farm manager that soil fertility doesn’t matter when selling a piece of ground, and that low-fertility fields will bring the same as farms that have received good stewardship. And this is apparently true based on what I’m seeing on farms that we are testing,” he reports.

He believes the reason is those farmers often have confidence that they can bring their new ground up to speed production-wise over time. And time is on their side as most buyers make the investment planning to hold onto the ground for the long haul.

Your next read: Ag Lenders Anticipate Only Half of U.S. Farm Borrowers to Turn a Profit in 2025

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