How many farmers do you know went under?

[ALLFARMER]

The Banks, FCC, AFSC keep it quite to the point where some might think it doesn't happen. So my question is how many farms to you personally know went under (lost everything, downsized by half, had to quit)in the last 3 years? I know personally of 6 farms...
2 - lost everything
3 - had to quit
1 - downsized by half

I would like this subject to be more visable. I prefer to learn from other people's mistakes rather than having to do them all myself!

I did not count my uncle who was given a working farm but prefers to drink Golden Wedding and cash oilwell & pipeline cheques. So not counting people who are simply a disgrace.

[PureCountry]

Its difficult to know how many have gone under, there have been many farm auctions where everything including the land is sold, and people often speculate if it is a bank forced sale but it really is nobody's business but the people that are directly affected. I agree its good to learn by others mistakes but many operations have ended up in financial distress through no mistake of theirs, just making business decisions to expand or by new equipment and then be hit with several years of drought and BSE.

[Bez]

"Mistakes of theirs" - unfortunately that is the common philosophy - but:

Yup - I know a bunch - they did it all the right way:

Raher than pick at some bones, I will point the finger at myself.

Business plans, lawyers, accountants, government assistance / advice - the whole shebang - long term contracts with various corporations. Historical studies to be sure all was in place and correctly in place. Even kept two complete years of operating capital in reserve - just in case.

All was done in accordance with best business practises, all due diligence carried out and everything tracked to make sure things were on line with the plan.

Two years into our expansion the border closed and then all those who were our friends - those who had been congratulating us at how we were actually ahead of the predicted line - became our sworn enemies.

Everything was worth less than the paper it was written on. And forget the legal stuff - unless your pockets are deeper than those are annoyed at you. And even then your odds are 50/50 at best.

We are still in the game but things have changed dramatically.

And unfortunately there are many who live nearby who love to point their fingers at us as being too "progressive" in our approach. I have heard this one twice - "Fools who did not know their place."

When you look at this industry as a business there is one thing that I leaned and that I will take with me forever.

"There are those who love to take pokes at others who tried to do something different from Grandpa and suffered because of it."

Not always, but often these folks are older and have no one to take over -so they will disappear. Who will tke their place? In the end does it even matter?

I also learned that you will have friends pop out of the woodwork at times when the situation seems darkest. People who come from places you truly least expected. They are a Godsend.

Pricing is determined by a very few and they have their finger on the trigger at all times. If a producer actually believes he will be rewarded by his hard work, he may learn the hard way that it is not always so.

Fact is, if there are few buyers, and there is a pile of packer owned cattle - there is no real competition and the price is lowered.

We started over and are building our own market for beef sales. There will never be another person or company other than the consumer who will dictate to us again.

Those who depend upon buyers from major packers - living like we once did - will never reap the true financial rewards of their labours in my opinion.

Several others went under financially simply because they honestly believed they could make it work. A couple of others were smart and stopped within a week of the border closing.

Two friends pulled the trigger on themselves - one a 23 year old and the other was near retirement - it hit this family hard - funerals are never a fun thing at the best of times.

In closing, I do not know ANY new farmers - under the age of 30 that have started within the past 3 years. That in itself should say something about our industry.

Bez

[Horse]

Bez one thing I would like to agree strongly with is when you contract cattle or any product you just slit your own throat but sadly there are those that think they are doing something great but all they are doing is making sure they dont get a decent price , but the lenders are adamant you need a contract .

[WoolyBear]

Livestock contracts don't mean squat........

Too many hog producers have found that out with Maple Leaf. Grids are changed, base price discovery bounces around, weight requirements go up, premiums are tightened or cancelled, contracts are also cancelled most often without reason.

Oh sure, they will still buy your hogs on a cash or spot market price. I am sure that the same has happened for cattle contracts too. My thought is if the buyer made the contract........ you'll generally come on the short end.

[Cedar]

Allfarmer: Why do the banks, etc. feel they have to keep all this stuff quiet...worried about their precious reputations or what? The 6 people you know who have been severely affected is very significant, and you're right...this does need to be more visible! If we could just develop a really popular website where people could report in on their experiences would be super! Some links to consumer organizations or something..so some of our consuming public would maybe have a chance to see "the real story". As far as learning from other people's "mistakes", I'm not sure that really applies to this situation....when we live in an oligarchical society such as this, how can learning any more ever help anything?????? It just doesn't seem to matter what we do........!!!!!!!!!!!

I don't know of any cases similar to the ones you report, however, I do have one neighbour selling out of cattle in the new year (forced or not, I don't know), and lots and lots of herd dispersals coming up....one sale for November 24 is already full locally, another is starting to fill for December 8, and just generally speaking it sounds like there are a lot of herd dispersals coming up real quick in the area.

emrald1: "people often speculate if it is a bank forced sale but it really is nobody's business but the people that are directly affected"

Bull-doo-doo!!!!!! These are the people who grow this nation's food you are talking about! It is everybody's business when so many are so severely affected!!!! The public has a right to know what is happening, especially as it affects food security and the possibility of corporate takeover of the agricultural sector..... we all know farmers are mostly responsible, caring, individuals who would never do anything to harm anyone, this cannot be said of the corporate world!!!!!!! If everyone knew the facts, who do you think they would rather have growing their food.........Monstanto, etc., or us??????

Bez: I believe your post makes my point! Sounds like you did everything right, but......look out!!!!! Funny how people can change so quickly when your situation changes. (We have recently discovered this with one of the (government) people we borrowed from! (Big mistake there apparently!)

"Fools who did not know their place." If that is the "mantra" of the "farmer"....then all is lost!!!!! To know that our place is that of peasantry and surfdom....well, how long can this possibly go on?????? It simply is not possible to continue to receive less and less for goods and pay more and more so somebody else can get super-rich. Eventually somebody will shut that system down, be it the farmer himself or his banker!

"Not always, but often these folks are older and have no one to take over -so they will disappear. Who will tke their place? In the end does it even matter?"

It has to matter....if it doesn't matter... who will provide decent food for our children, grandchildren, great-grandchildren, etc.???? If the megcorps get their way, there will be nothing but "poison" for them to eat!!!!!!!

"We started over and are building our own market for beef sales. There will never be another person or company other than the consumer who will dictate to us again."

Congratulations! Now you are on the right track! I wish you all the best in this endeavor....please let us know how things are going! That is the connection we all need....both us and our consumers....to be connected to each other and eliminate all these "evil" middlemen who are destroying things at both ends of the chain!

It is so difficult to hear about your 2 friends who couldn't survive this situation....however we need to share this info....amongst ourselves and the public, so we can all get a grasp on what is really going on out here!

WE HAVE THE RAW PRODUCT ON WHICH FORTUNES ARE MADE......why are we in this unbelievable situation???????? Why can we not take control of things?

If we could just get the consumer on-side....maybe they could "persuade" the politicians to participate in a realistic view of agriculture..... Our society lives in a "horseshoe" ( an upside-down one, unfortunately!) with both ends of the horseshoe having the life sucked right out of them by the "powers that be" in the middle of the horseshoe! If we could only close this "horseshoe" and make it a complete circle....with a connection between the consumer and primary producers.....

(Sorry for the verbal diarrhea again....but sometimes, ya just gotta "spill")

[cowman]

Well personally I don't know any that "went under". I hear a lot of them saying they are taking a beating and obviously there are a lot getting out of the cattle business for whatever reason?
My neighbor thinks the banks are knocking on the door of some of these guys and that they are basically being forced to sell their herds, but I don't know if that is the whole story or not? Seems to me a lot of people are just frustrated with the whole business and sick of working for nothing? I mean here they are sitting on all these assetts and getting very little return. Working for wages that frankly would make Walmart blush!...and everyday the clock is ticking and opportunity is passing you by!
I do have faith the cattle business will turn around and we will see good times again. But I also believe when the dust settles close to 50% of the cow/calf operations are going to be gone. I always said the guy with the deepest pockets(and dumb enough to dig deep) will be the one who survives and maybe somewhere down the road will reap the benifits?
I will add the cattle business is looking fairly decent right now compared to grain or hay. Hogs are fairly decent but there are few left in hogs and they are dealing with a pretty tough bunch of packers. I suspect cow/calf in the future will be a struggle as the packers and feedlots integrate more closely? I also suspect the only way anyone is going to survive in the cow/calf business is get real lean and get those costs down?
I don't have a crystal ball of how that can be achieved! I do know debt and owning more equipment is a sure fire way to the poor house!

[Horse]

I havent mentioned it lately but if the govmt would get out of helping some with welfare cows and grass I tkink it would be a little easier to compete.
With almost 1/2 the cows in alta benefiting in some way from crown land it puts a lot of subsidized beef on the market.
Olso mabey there should be tighter restrictions on how much you can contribute from wages to propup your farming enterprise , I dont have a formula and most all of us had to start with a job but when does it become a tax shelter?

[cowman]

Well I wouldn't worry about it too much. The whole darned cattle industry is built as a tax shelter! Why do you think all those feeders are paying these good prices for calves? Do you think they figure they are going to make a killing?
The "welfare cows" thing is not going to ever be changed? Too much money involved, in too many places? Ralph got his butt kicked when he tried...he won't try again!
The fact is the taxpayers of Alberta would be quite a bit better off if there were no cows on any public land, but that isn't going to happen.

[cowman]

reply to cowman ad,yes we all know of a feeding operation in ponoka went under.
why? not because of bse!
problems started before the border closed, and leave it at that !
your comment of all taxdollars problems
for high feedercattle purchase and keeping the calve price high is not a
valid reason at all.
we are operating on small margin but need numbers. so 12 to 1500 head unit per man feeding could make a profit.
so this small family feedlot is doing
ok.we are not competing with the big boys
feedlot who cannot find help!
even at20 to 25 dollar/hour for penchecker this is what is going on at
feedlot area around lethbridge.
so far with goverment help and carefull
home feeding and good manesment not any ofwe know had to stop by bank !!

[cowman]

Wait until early December when the tax money comes to town and watch the price go up! A lot of feeders made a real good profit this year on those cheap calves they bought last fall...they'll be looking to buy no matter what...or give it to revenue Canada?
Top that off with really cheap feed and you have a situation that looks very good for the cow/calf producer this year?
Intend to sell the better steer calves around the end of November and keep the heifers and later calves. Those big April char cross steers really did well this year!