Land Rent

[MBFarmer1]

Hey guys, definelty not piling on to Ron here but thought I might offer a word of caution. I farm in Southern Manitoba, am fourth generation on the same homestead. IN this areas crop failure is basically unheard of 50 bu canola is very common, 60 wheat, 80-90 barley. Due to the stability of the weather we do not carry excess crop insurance. In my dad's 38 years of farming we would never have qualified for a benfit so it seems a waste. We do carry hail ins as that is a problem. Land rent two years ago was about 75. In 2004 we seeded only 2/3 of our land. First time in our farm's history. Then got nailed with frost. Total disaster of a year. First one basically ever. Then last year seeded all land but onyl harvested about 1/2 due to excess moisture. Even worse disaster. If another bad years this year we will without a doubt go back to old school 1/3 summerfallow, 2/3 crop to reduce input costs. Land rent for this spring is about 35. The point I am making is that Ron says he never has crop failures and has a reserve built up etc. Two years ago I would have been right beside him saying exactly the saem thing. The one true master of farming, Mother Nature, has humbled me greatly.

[JD4ME]

Despite the fact I should leave this one alone the underlying truth to this thread is the land rent is a simple factor of free enterprise and economics of scale . In our area, land rent runs from 45-even up to 70 where the land is being rented by a feedlot where they are silaging the crop and using it to spread manure on. This is dryland, irrigated rates have been known to be higher. Do I wish it was lower? Heck yes, and it should be but is it going to be? perhaps marginally if the dollar continues to appreciate and the commodities depreciate further.
A few years back I had the pleasure to attend a meeting with farmers from all across the west at the time land was renting here for 45-55 and we had this same discussion one good fellow from around Humboldt was renting good land, all he could handle for 10. There are many factors that affect land value unfortunately not all of them are agricultural in nature. There have been people that have sold out and went into Sask, and some that thought about it, took a look around and realised their families wouldn't accept the transition. It's a long way from cutknife to costco if you follow my drift. IN central Iowa the rents are 200 an acre ,sometimes less sometimes more that's what people will pay there.
If it doesn't pencil to you to rent the land with the rental rates being paid in your area then don't. Sit back and wait, and if you're right and the guys that rent it are wrong you'll get a chance at a rate more to you're thinking. If youre wrong.........
Don't think this decision is just applicable to farming, Everyone else that runs a company from you to Walmart to General Electric is faced with these decisions. Go make them to the best of your management ability and for the best of your company that's all you can do.

[furrowtickler]

Have been reading this thread with interest.
MBfarmer: Our yeilds are 20% off yours and land is still renting /selling for $35/ac $90,000/1/4. Your sinario is very simular to ours,the last 5 years has humbled everone greatly to the control mother nature has in our lives.
Several Albertans have moved into this area over the past few years, hence land prices/rents are staying artificially high. These same Alberta guys are taking it on the chin now.
Cowman, "Is $35/ac enough for the land lord?" This atitude is going to swamp all young farmers. It is all relative to where you are, in our area landlords are in for a rude awakaning $35/ac is too high for the risk involved.
As far as the cash/cropshare rent thing, our most flexable rent is $15/ac and 10% crop share. Over the last 5 years we have paid anywhere from $18/ac to $38/ac. You should be paying 1/3 fert and fuel as well, your relative is foolish.
I agree with toughgo.. coming to Sask to farm cheap land/low rents is a vary false sense of security. Moving out of the promised land to the central praries ... take away 30-40% yeild potential add frost,dought, and horrible crop insurance coverages and they will be out just as fast as they come in.

[furrowtickler]

Mbfarmer, you make the point I was trying to make. I am in the same boat as you my Dad said after 03, and drought never has he had 2 bad years in a row, then came 04 frost, and now 05 bad grades shity prices. It does happen. Ron claims they are in a sure crop area. I do tend to believe your yields opposed to Ron becuase Manitoba is generally wet, Alberta is generally dry.

Jd4me, why are we constantly bitching about the CWB or the shity prices if people are still paying premium dollar for land. Personally if goverment officials were to read this I would be embarrased because we sound like a bunch of morons.

[JD4ME]

Why are you constantly bitching tough? Thats a good question, likely because of the same reason some teachers bitch and some truckers bitch and some doctors bitch. There's stress in every occupation even the homeless bitch and they dont have an occupation.

Deep down inside everyone who posts here on Agriville is aware of a few certain facts, farming will continue to evolve and change. It always has, it always will, the concern lurking in the back of everyones mind is if they truly believe in this industry and want to remain in it is "Am I doing what it's going to take to keep my operation viable into the future?"
We do not have a god given right to farm , no matter how many generations have farmed the land before you and despite the fact that it sucks, we all know a few of us won't be passing the farm on to the next generation. It's hell on our commnities and on ourselves at times but its how it was in the countries our families emmigrated from and it is here.

Bitching is normal, but if you want to survive don't think in terms of problems think in terms of solutions.
I always chuckle to myself when I post something on here and certain people have to point out why it won't work I wonder if they run their farms that way, our farm is and continues to be successful why? Because I don't look for problems I look for solutions, accept the fact though sometimes you might not like the answers that you find.

[JD4ME]

Jd4me.WOW, someday I hope I can be as successful as you, and look at everything in a positive way. Thanks for opening my eyes your're right this a great buisiness and it is my choice.

I think after seeing the light now and how everything is going to be O.K., I'm going to get me every acre I can. Cowman, Ron where can I get some of this good land?

Give me a break Jd4me save your sermon for someone else.

[Vader]

One of my fellow CWB Directors just returned from the American Corn Growers Association (ACGA) annual meeting. They are concerned that the new farm bill will remove funding for the CRP program. The US government is trying to find ways of reducing its budget deficit. The CRP program pays $50.00 per acre.

The US government is considering the removal of one billion dollars from the CRP program which would put 200 million acres back into production.

The ACGA is doing an analysis which they say they will post on their website. The early talk is that wheat and corn prices will drop by something like 50 cents per bushel.

What will that do to land rents here in Canada?

[JD4ME]

Let us know when your farm sale is tough, because with your atitude it'll be sooner than later obviously and when it happens make sure you blame everyone and everything else it'll be easier that way.

[WoolyBear]

We've have ALL experienced the frustrations that many of us are voicing on this discussion. I know I have "budgeted" in Feb, ordered the seed, applied the fertilizer, sprayed the crops and then had frost cut up a perfectly good crop of wheat and canola one evening.(or dried out, or eatten out, or drowned out) Crop insurance doesn't come anywhere close to covering the input cost. Your bins are full of Fd Wht, and peppered canola. None wants it, and the bills still come in.

If we're thinking about the cost of rent, thats just one cost that we should have some control over. Obviously we can't control fuel prices and we don't all get volume rebates like our "bigger" neighbours. We don't all have the best land, the best weather conditions, the best opportunities that may have come the way of generations before us, or the best of neighbours. Sooner or later we will all experience the shortcomings of nature and the business world. We just have to learn to deal with it as much as we can. Hopefully we can all survive in our part of world.

The discussion is interesting, but the name calling and sarcasm that I'm seeing is only because of the stress I am sure we are all experience.

Good luck everyone.

[JD4ME]

PS tough

Speaking of giving people a break, Give us all a break ,all you do on this forum is attack and whine, offer constuctive solutions or accept them but don't think you have a right to farm or to survive in a global industry thats going to get more competitive not less. You came on here asking the question then proceeding to atack everyone who took the time to offer some solutions or their thoughts, here's a solution go outside and do some work instead of wasting time on the computer, you're not willing to listen so don't ask.