Spring Crop Choices in the UK

[grassfarmer]

Well said Wilagro, I often think the same with the endless CDN/US price comparisons.
To highlight the UK scenario better arable land in eastern England averaged over CDN $9000 per acre last year but larger tracts of farmland often sold in excess of $13,000 per acre. How much of your margin is eaten up paying for the land at these prices? Much of that expensive land was sitting under water last summer too so don't believe everyone over there is getting rich.

[Lifer]

What is their rent?

[grassfarmer]

I'm not up on current land rental prices but know that very little land over there is rented out on a cash basis like it is here. Long term farm tenancies were probably paying around $120 an acre back in 2000. We paid as much as $400 an acre for 6 month pasture rental pre 2000. That was chasing extra forage acres to be eligible for "extensification" subsidies. Different world - different systems - different problems. No relevance to current grain prices in Canada or the cwb.

[FarmRanger]

Ok, let me get this straight.
So what you’re saying is that our having lower grain prices than everyone else in the world is a good thing because it devalues our farmland?

[charliep]

The point of the U.K. maltsters presentation was the following.

Farmers in the UK (and Canada) make decisions about to grow (including pasture for livestock) based on profit potential per acre.

Barley production in the UK, Canada and for that matter the world has been declining. A strong indication that barley profit potential per acre is declining relative to other alternatives.

UK malsters have recognized this and are working to towards stronger value chain relationships and profitable farmer prices to encourage forward contracting/other arrangements. UK brewers and distillers have been willing to take on more risk in innovative programs to ensure adequate volumes contracted.

Moral: In the UK, malt barley is moving from a commodity to high valued product in a value chain. This requires all members of this chain to work together to meet each others profit objectives, product requirements and abilities to manage risk.

[grassfarmer]

No, what i'm saying is that comparing theoretical returns from grain production in a country half way around the world with a totally different land base, production costs and growing systems and using that to attack the cwb is juvenile nonsense.
It is all theoretical anyway - do you think they don't get poor crops, wet harvests, crop failures, no harvests there??

[agstar77]

In other words CL, show me the money !!Maltsters have not been willing to pay enough. Growers are willing to do whatever it takes if the returns are there.

[FarmRanger]

You'd think that maltsters would be falling over themselves trying to build plants close to the cheap barley, wouldn't you?

I wonder what's stopping them?

[Lifer]

So I would understand from you grassfarmer. That learning or trying to understand what is happening in other countries isn't important.

I guess you would say "If it ain't happening in Canada it ain't happening".

[charliep]

Agstar77

Perhaps the maltsters are paying enough but the price signals aren't getting through to farmers. Maybe if they did (as in an open market like the UK), farmers would grow more malt barley. As flawed as the CashPlus program is, the situation will have improved in 2008/09 - there is a relationship between what the maltster pays and the farmer recieves. At some point, you will have to explain the 75 cent/bu hold back Vader has bragged about in previous threads.