Given the volatile crop market, many farm managers are looking for additional revenue streams. Specifically, hunting leases are a relatively low-risk option—significant upside with minimal upfront investment.
If you’re looking to diversify your portfolio, pick up new ground, or offset losses from crop production, read on to learn why a hunting lease is a tool you need in your arsenal.
The reality is, neither farming nor hunting is itself a better use of land. For each piece of land, multiple factors are at play, including:
When considering the economic benefits, it’s important to consider profitability, not the total cost of production. For example, the average acre of soybeans yielded 49.5 bushels in 2022. Priced at $13.33 per bushel, this leads to an average $660 per acre.
While this is significantly higher gross income than a hunting lease could give you, consider that the cost of soybeans averaged $709 last year, leading to an average $49 per acre loss. So the fact that a hunting lease puts you ahead is itself a benefit.
What’s more, not only do hunting leases have fewer (if any) input costs, they also don’t require cleared farmland, and can be applied to any number of land types, including marsh, timber, points, and more.
Of course, the specific use case will depend on your landowners’ needs and the state of the land at your disposal. But it’s important to crunch the numbers and see which use case is more profitable, all factors considered.
As a farm manager, you may not be thinking about hunting leases as a tool in your toolbelt. It’s time to think again. Because, as we’ll show you, there are plenty of benefits you can realize when you add it to your arsenal.
There’s a reason landowners hold onto their farmland. Not only does it appreciate over time—especially in recent years—but it presents multiple cash flow opportunities. Aside from seasonal crops, there are a number of farmland monetization strategies you could employ:
There are multiple hunting and fishing activities that can take place on farmable land (both tillable or non-tillable). Especially if you decide to cover crop or let the land lie fallow for a season, leasing for hunting can be a great way to continue generating revenue even if you aren’t actively farming that land.
Depending on when your state designates specific wildlife hunting seasons, there’s probably a window that corresponds to the planting off-season. If you time it effectively, you can seamlessly transition from one monetization strategy to another.
Given the risks facing the ag industry—weather, commodity markets, rising input costs—it’s always a good idea to have multiple revenue streams at your disposal. Since hunting is insulated from these dynamics, it’s an excellent supplement to your farming efforts.
In addition to diversification, leasing farmland for hunting can also increase the profitability of your land management practice. Especially as input costs increase and crops are less likely to break even, supplementing farming income with hunting revenue can offset these losses.
Keep in mind that owning an asset also comes with property tax obligations, which remain in place regardless of whether you have a good crop year. Helping your landowners find new ways to offset these liabilities can help strengthen the relationship and prevent you from churning another client.
Depending on your state and local regulations, you can allow hunting on your farmland during the planting season. For farms that deal regularly with excessive wildlife, this can be a way to control the population and protect crops from loss.
Rarely is 100% of the land in an owner’s possession farmable. Likely there are parcels that have been cleared, and others that they may or may not want to clear. What’s more, even farmland that’s been cleared for farming, if not continuously maintained, can require additional investment to prepare it for the planting season.
The end result is a not insignificant amount of land in your owners’ possession that isn’t immediately farmable. Given the current low profitability margins, it’s difficult to justify an investment in clearing and otherwise preparing such ground for farming.
A hunting lease enables you to monetize non-farmable land with limited upfront investment. What’s more, most hunting leases are short-term, which means you can deploy multiple leases throughout the year.
Most farm managers focus their expansion efforts on ground that’s currently farmable. When there’s enough margin to justify further investment, they may sometimes pick up non-farmable ground for transitioning.
Leasing land for hunting opens the door to more leasing opportunities—including non-farmable land. This enables you to continue growing your land management business, despite a challenging market.
When incorporating hunting leases into your farmland management practice, you have two approaches at your disposal:
Regardless of which approach you want to apply, it’s critical to familiarize yourself with federal, state, and local regulations—including designated hunting seasons, bag limits, etc. Failure to comply can be costly, which defeats the purpose of leasing the land in the first place.
As the crop market continues its volatility, it’s important to find new ways of mitigating risk and offsetting tax obligations. Hunting leases can open up new revenue streams, not only for current farmland, but other non-farmable land in your owners’ possession.
After your landowner signs off on the use of their land for hunting, the next step is to put in place the systems and processes for managing the complexities of multiple use cases. GroundOS is built to be a one-stop shop for land management—including managing farmland and hunting use cases simultaneously.
