Iroquois Valley understands that transitioning a farm to USDA Certified Organic takes a committed, knowledgeable farmer investing time, money and resources. The Company has designed its leases and mortgages with this transition in mind. On the lease side, farmers pay a base-rent that is determined by the acquisition price of the land. After time, farmers pay variable rent in years where their revenue surpasses a certain threshold. Variable rent payments usually coincide with organic certification, when crop prices are significantly higher and revenue increases in kind. Even after certification, farmers may have challenging years because of the variety of risks associated with farming, including weather. The cash dividend that shareholders receive may be dependent on variable rent payments across the portfolio. This structure means shareholders are sharing both the risk and returns with the farmers Iroquois Valley works with.
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