By Connor Lynch
ST. ISIDORE — Twenty years ago Jack Fraser, a cash crop farmer with a small dairy herd near St. Isidore, wanted to expand his 1,000 acre farm. But at the time, there wasn’t any suitable land available to buy. So he went the rental route.
Twenty years later he’s still renting those 300 acres. He’d be in the market to buy but land prices being what they are, “it doesn’t make much sense to be buying.”
Fraser’s part of a growing trend of Canadian farmers renting land to grow crops because of tight supply thanks to rising land prices, retired farmers hanging on to their land, and non-farmers investing in acreage, says a University of Guelph researcher.
Professor Dr. Brady Deaton says the amount of farmland being rented has been on the increase since the 1970s, not just in Ontario but across the country.
Twenty-three per cent of Ontario’s farmland was rented in the ‘70s. As of 2011, 35 per cent of Ontario farmland was rented.
Buying land can be prohibitive. Good Eastern Ontario farmland can sell for as high as $10,000 per acre or more. On the other hand, renting from $75 to $120 per acre might seem like the best price you can pencil out based on low commodity prices. A Cornwall crop farmer placed an ad in a local newspaper offering to pay area landowners $350 per acre for some of the best tile-drained land in the region.
But when you’re not paying for the best, renting land can come with its own problems. “Most land that’s available needs improvements, maintenance. Tiles need to be fixed, ditches need to be looked after. Landowners in general don’t do that, but you gotta if you want to farm it,” said Fraser, who adds value to the land but only gets a return on his crop.
But it also has an upside for farmers sick of wading through paperwork and legalese. Deaton said that most farmland is still rented through informal agreements, and Fraser does just that with a couple of retired farmers in his area. “We agreed on a price and that was that, didn’t write out a contract.”
And 20 years later he’s still working the same rented land.