Auctions Gain Popularity for Farm Leases
Cash rent auctions for farm leases are a growing trend according to a recent article on Ag Web. While auctions for purchasing land have been around for a long time, the auction format for farm leases is somewhat new. One of the benefits of the auction format is price transparency. “Rent auctions provide true open market rental valuation and answer the question: What will the market bear for my ground,” according to Jim Rothermich of Iowa Appraisal. The cash rental rates traditionally published by the Land-Grant Universities has not necessarily kept pace with actual market data, due in part because the University data relies on producer survey responses. The auction format for leases provides an open competitive marketplace for accurate price discovery. Another benefit is that it allows landowners to choose from several bidders to find one that matches the landowner’s criteria.
Auctions are used for selling many things and can create some interesting legal issues. An auction results in a contract between a seller and (usually) the highest bidder. The mechanics of contract creation in an auction differ a bit depending on whether or not the auction is without reserve (i.e., the seller hasn’t reserved the right not to sell). For example, the auctioneer serves as the seller’s agent and makes offers to sell by calling out prices which buyers can accept, subject to being the highest bidder. Most often, other terms of the contract are included in paperwork that bidders fill out before participating in the auction, and the auctioneer can also modify the contract terms if they are announced publicly with the bidders present. It is interesting to note that in an auction for a lease, instead of bidding to acquire the land, bids are solicited for a right of temporary occupancy.
An AgTech Moonshot Graduates to Commercial Viability
Alphabet (Google’s parent company) recently launched Mineral, an agricultural tech project incubated in its secret “moonshot factory” which investigates and tests radical technologies to solve some of the world’s toughest problems. Mineral’s mission is to increase farmland production sustainably by using an array of technologies and tools to collect enormous amounts of data. Mineral is collecting data from its own proprietary field rovers, combining it with other data from satellites, farm equipment and public databases, and applying complex modeling and artificial intelligence to analyze the data for useable results. Mineral’s approach is also unique because it isn’t focused on just one crop or geography, but is analyzing data at a global scale over a wide range of crops, including corn, soybeans, berries, lettuce, beans, melons, and others. It has surveyed and analyzed at least 10% of the world’s farmland so far. You can read more about Mineral here and here.
