Income

Investors in stocks receive income through dividends.  Investors in farmland receive income by renting land to a farmer.  This can be accomplished under two basic arrangements: 

Cash Rent

Under a cash rent arrangement, a tenant (farmer) pays a fixed amount of rent to landlord (land owner) to use the underlying farmland.  Typically, rents are either paid in advance or guaranteed by a letter of credit. 

share crop

Under a share crop arrangement, a landlord (land owner) does not receive a fixed amount of rent from a tenant (farmer) but rather receives a portion of the crop produced on the land.  The farmer bears all input costs, while the land owner receives a portion of the crop (typically 1/3).   

Unlike other real estate, farmland is always 100% rented.  The reason for this is that farmers aggressively seek additional ground to rent.  Most farmers need additional land in order to spread the cost of their equipment over additional acres.