The importance of land leasing and farm forestry to a farmer cannot be gainsaid. But what does land leasing entails? It entails written legal agreement signed between the landowner and the active farmer who wish to utilize the farm.
Involving an accountant for purposes of valuation and a solicitor who is acquainted with land leases is crucial. Keeping a forest in the land is invaluable
Importance of land leasing to a farmer
1. Security of tenure
As mentioned in the introductory paragraph, land leasing involves agreement that gives a farmer security on land and use. This will ensure and insure a farmer from disturbance in the land they have invested in.
2. Better use of capital
Buying land is more expensive than leasing. Therefore, leasing leaves a farmer with surplus money for investing
3. Spread payment period and balanced cash inflows and outflows
A steady cash flow is ensured with leasing since payment related to leasing is spread over a period of time saving the farmer one big payment in buying
Other benefits includes: Affords a farmer better planning, low initial capital expenditure, and tax obligation which reverts back to the lessor
Farm forestry, on the other hand, is so beneficial to the farmer both aesthetically and economically. It includes the following:
1. Provide wood for fuel
2. Production of timber
3. Environmental benefit
4. Provide forest based food e.g mushrooms
5. Provide botanical and medicinal herbal
6. Trees attracts rain which is important in farming
It therefore goes without saying that land leasing and forest farming is very important and intricately interdependent since trees can provide manure to the soil which ensures optimal production from the farm. As well as all of that, a smart person might take a look at an ERP Demo, which could help to point them in the right direction.