Explaining the potential benefits of share farming as opposed to traditional partnership.
Considering farmland may stay in the same family for generations, share farming can be a great way to allow new parties to get into agriculture. At the same time, it reduces some of the operational burden from landowning farmers without them relinquishing management responsibility.
The owner typically provides land, fixed equipment, expertise and a share of working capital or livestock and will receive a share of the actual commodity produced.
The operator provides labour machinery and a share of working capital or livestock and again receives a share of the actual commodity produced.
Returns are calculated based on the value each party brings, sharing the cost and then the income in the agreed proportions. Share farming allows both parties to share the risks and rewards on pre-arranged percentages, with the owner providing the land and the start-up farmer responsible for operations.
Find a complete detailed breakdown of share farming in Thomson & Bancks’ full article, as published in Cotswold Homes Spring 2018 Edition.
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