Flipping thru the Classifieds

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Flipping thru the Classifieds

Klause's Avatar Feb 4, 2018 | 15:55 31
Quote Originally Posted by bgmb View Post
Klause you are absolutely correct and i agree that lentil belt is way way over valued. That area will see a big correction i think but even there half the land wont change hands. High leveraged operations in those areas will fail.

On our farm we store grain to pick up the carry. Other farms deliver off the combine.


Land just north of me is $500,000 a quarter. 90bpa barley 50 wheat 50 canola.


Same as lentil belt but lower potential.


And I realize MB can move bushels. Sask can't. Wheat is 3 months out. I'm trucking Sept malt barley contracts for guys.


Can't even move pea contracts off the combine that you sign 12 months in advance.


South of #16 in MB producers are blessed with a near-USA system... The rest of the prairies especially Sask isn't.


There's a pile of farm's that went from zero to 20,000- 100,000 acres in Sask that never happened in Manitoba either.


Need to understand the bigger picture Reply With Quote
Feb 4, 2018 | 16:01 32 Klause. By the way tou dont have to go back to the 80s to find lots of hurt in farming. Lots on here survived 5 dollar canola and frozen 2$ feed wheat in the early 2000s Followed by flooding. we were happy to gross 300/ac on a good year. Land prices maybe sofened 20 percent from better years previously.

If i were you i would quit looking abroad for greener pastures, they dont exist. Best thing you can do if you think farming is going to crash is have short term land leases and set some cash aside to buy land once it does.


Best advice I have for you is forget about wild predictions and political issues Focus on what you can control look out for you and your family amd forage ahead Reply With Quote
farmaholic's Avatar Feb 4, 2018 | 16:04 33 Like... Reply With Quote
Feb 4, 2018 | 16:09 34
Quote Originally Posted by Klause View Post
Land just north of me is $500,000 a quarter. 90bpa barley 50 wheat 50 canola.


Same as lentil belt but lower potential.


And I realize MB can move bushels. Sask can't. Wheat is 3 months out. I'm trucking Sept malt barley contracts for guys.


Can't even move pea contracts off the combine that you sign 12 months in advance.


South of #16 in MB producers are blessed with a near-USA system... The rest of the prairies especially Sask isn't.


There's a pile of farm's that went from zero to 20,000- 100,000 acres in Sask that never happened in Manitoba either.


Need to understand the bigger picture
I north east sask is badly landlocked. Mb is better for sure. Yes there are many new btos in sask But I just dont think that is a really high. Percentage of land plus lots of them are probably in good financial shape and some will make deals to lower rent or erase debt. Reply With Quote
Klause's Avatar Feb 4, 2018 | 16:19 35
Quote Originally Posted by bgmb View Post
I north east sask is badly landlocked. Mb is better for sure. Yes there are many new btos in sask But I just dont think that is a really high. Percentage of land plus lots of them are probably in good financial shape and some will make deals to lower rent or erase debt.
Lol.


You keep believing that.


I'm a dual citizenship... Good businesspeople invest where there is opportunity.

To each their own Reply With Quote
Feb 4, 2018 | 16:34 36 Best of luck Klause when i see pics of your certified organic crops in Argentina I will know you can walk the walk Reply With Quote
Feb 4, 2018 | 17:02 37 In the 2016 calendar year there is evidence Russian wheat of all types sold for an average of 166 USD/t
I for one am not ready to compete against those prices. Being first to market at that price is not a recipe for success. They will have their market. The talk has been around for 40 years that if the Black Sea farmland was ever made to produce to potential the market would never be the same. Well its happening Reply With Quote
brs
Feb 4, 2018 | 17:14 38 When things r in a uptrend nobody looks below. I'm not saying land is going to drop to pre 2010 levels but there will be a correction and I think a fairly substantial one. I was looking through input statements a couple weeks ago from 10 years ago till now and can't believe the uptrend in prices. Chem companies have nothing to worry about they get the percentage return year over year. All I am saying is the risk is getting ridiculous for the reward. Reply With Quote
LEP
Feb 4, 2018 | 17:20 39 Klause, I have farmed since the late 70's. Since '90 with enough money on the line to matter. I remember thinking the same thing you are for many years.

Then somewhere along the way things changed and I realized we have it not too bad.

I have been an owner of several different businesses in different sectors and worked in different sectors as well.

They are all tough to run and grow a business in. The saying goes, if it was easy everyone would do it. Reply With Quote
farmaholic's Avatar Feb 4, 2018 | 17:26 40 Soooo..... paying more for the land than the income it can generate to pay for itself isn't sound business management ?


And all this time I thought......

Lowest cost producer didn't mean anything.

No more land eh, Reply With Quote
Klause's Avatar Feb 4, 2018 | 20:20 41
Quote Originally Posted by farming101 View Post
In the 2016 calendar year there is evidence Russian wheat of all types sold for an average of 166 USD/t
I for one am not ready to compete against those prices. Being first to market at that price is not a recipe for success. They will have their market. The talk has been around for 40 years that if the Black Sea farmland was ever made to produce to potential the market would never be the same. Well its happening
We don't have a choice.

New varieties only push yield... and the world isn't looking for protein that much anymore.

That price works out to $5.62 a bushel.... at port.

The way it currently works, that would give us $3.50 off farm.



Oh, and INTA released two wheat varieties into the public domain that are high protein short season red wheat for the winter season.

Here comes competition in the 13-15% protein class.


We need to find niche markets and crops, or we're dead in the water.

Remember those years the CWB couldn't sell our whole crop, when it was 1/2 to 2/3 of what it is today? Yeah... Those days. Reply With Quote
blackpowder's Avatar Feb 5, 2018 | 01:07 42 Everyone here possibly right.
Nothing new happens given long enough timeline I suppose.
Hard to know when to cash in.

What is in Saskatchewan DNA that has people seeing 1929 lurking in every shadow? Reply With Quote
Feb 5, 2018 | 01:54 43 Before we all give up, best to keep in mind that mother nature has a bad habit of throwing a wrench in when least expected. In recent years She has been awfully benevolent to farmers worldwide for an unprecedentedly long time( longest period since the end of the medieval warm period IMHO). She may just keep doing so, but history seems to indicate that these periods are the exception, and not the rule. Unfortunately, it might be us who she decides to pick on next time. Reply With Quote
farmaholic's Avatar Feb 5, 2018 | 05:00 44
Quote Originally Posted by blackpowder View Post
Everyone here possibly right.
Nothing new happens given long enough timeline I suppose.
Hard to know when to cash in.

What is in Saskatchewan DNA that has people seeing 1929 lurking in every shadow?
Maybe because its felt like 1929 until less than a decade ago. The depression(economic) mentality had been seared into the two generation's memories who were alive at the time and then the dire warnings handed down to their successors like religion! We never had the prosperity our Western cousins had... Reply With Quote
Feb 5, 2018 | 06:44 45
Quote Originally Posted by farmaholic View Post
I'm looking through the Western Producer classifieds this morning.

I remember a couple of decades ago there were pages and pages and pages(and the physical size of the pages were bigger than they are today) of Sask farmland for sale. Now there are a few short columns and that space is even littered with real estate agent ads and even want ads.

What a difference 2 or 3 decades makes, was it that bad then or is it that good now?

WANTED: functioning crystal ball, 100% accuracy rate.
Everyone has made interesting comments about land and prices and where things may go. But getting back to the original comment about the skinny “Failing Western Producer Classified Ad Section”...it has nothing to do with the farm economy but all about technology.

There are way more interesting ways to sell your items than over print on WP Classified that didn’t exist 20 years ago or were not embraced yet. Kijji for one I think is dominating, it’s quick free or cheap and has broad appeal. I used to love the WP Classifieds and was the only reason I got the WP for years was for the classifieds, as I had to painfully wade through the very weak and gossipy one sided opinionated stories to get to them.

Quit the subscription years ago and can’t say I miss the garbage reporting. Still look on-line at it and see that the stories are still weak and they couldn’t even manage the classified ads online and farmed it out to Farmzilla...progress as they say. Reply With Quote
Feb 5, 2018 | 06:48 46 land prices may slow or drop a little, but there wont be any big correction. lots of farms with lots of wealth, and with improvements and increased size of machinery over the last 10-15 years, farms continue to grow in size. If we are going to compete in the world markets, either grow in size, or specialize in nice markets. Reply With Quote
farmaholic's Avatar Feb 5, 2018 | 06:50 47 Good point Crestliner. Reply With Quote
Feb 5, 2018 | 09:40 48 There are many farms that already have had disasters over the last 10 years. Too wet in NE sask and NW Manitoba, from 2010 to 2014, Drought 2015 in South Sask, late harvest and poor quality in 2016 and that was on a big part of the prairies. Banks have have been doing record amounts of refinancing and cash injections to keep operations going. Most guys don’t go around bragging that they have to refinance so that’s why you don’t hear about it. Trade credit, at Input Retailers and dealer financing on Iron are easy to come by. CCGA cash advance and Input Capital are your last options. There have been many guys who have used up these options and have quietly exited by selling out enough assets to get out of trouble and then renting out what land they own, or having to sell out completely. The difference now vs the late 80s early 90s financial crisis is most times the banks are telling guys well in advance to get out while they have some equity. Call RB auction disperse the equipment and get out with maybe some money. The land rules have changed and outside investors are allowed to buy land. You are also seeing Hutterite colonies start new colonies. Guys from Alta and Ontario are selling their land their and buying in Saskatchewan. And finally there is still many farms who have done well over the last 10 years. There are many farms who are very cash rich, but again don’t go around bragging. The ag industry has to be the worst for jealousy. You can see it on Agrivile daily. Many if these operations are ready to expand and ready to take over any land that comes available. We may see a correction in some areas , but many of these factors will continue to hold land prices up. Reply With Quote
Feb 7, 2018 | 11:39 49
Quote Originally Posted by Klause View Post
We don't have a choice.

New varieties only push yield... and the world isn't looking for protein that much anymore.

That price works out to $5.62 a bushel.... at port.

The way it currently works, that would give us $3.50 off farm.



Oh, and INTA released two wheat varieties into the public domain that are high protein short season red wheat for the winter season.

Here comes competition in the 13-15% protein class.


We need to find niche markets and crops, or we're dead in the water.

Remember those years the CWB couldn't sell our whole crop, when it was 1/2 to 2/3 of what it is today? Yeah... Those days.

Klause you state "Remember those years the CWB couldn't sell our whole crop, when it was 1/2 to 2/3 of what it is today? Yeah... Those days"

Can you substantiate that with facts or is this more hyperbole?. Remember that in the last 5 years the Canadian dollar has been at 70 to 80 cents US thus masking the real price. Currently the $4.20 1RS low protein wheat at my elevator is only $3.36 a bushel in US dollars.

The US Export Enhancement (EEP) program that started in 1985 devastated the price of Canadian and world wheat price.
EEP was still active in 2004 in the feed grain market depressing the price of 2004 Canadian feed wheat. How EEP worked was that the US on a sale by Cargill for example to another country would sell two bushels and send a third bushel along free.
I remember talking to CWB Commissioner Forest Hetland at the time and he said he was back from a sales mission. Hetland said he was "giving wheat away". EEP's impact was higher price in the US because the US was and non subsidized market. Uninformed Canadian farmers then ran the border. EEP was a program for the US trans nationals to put pressure on the CWB and AWB to take market share.

Niche Markets. The CWB and Canadian system did supply big niche markets such as Japan, Great Britain etc.. Remember durum and malt barley. Remember Warburton contracts and the Churchill freight and storage program.

In fact the last 6 years that the CWB operated were the best years we had on our farm and remember the dollar was at or near par with the US. Reply With Quote
Feb 7, 2018 | 12:40 50 I really don’t get the negativity. I am not saying things might not change in the future, and the 2020’s might in fact be just like the 1980’s. But for the future we can see (2018 prices) we have 400 a tonne N (or at least we had for quite a while) and we have 11.25 canola and 12.75 Nexerra. If we call wheat break even you should make $100 an acre off your canola, based on a 35 bps Nexerra or 40 bpa commodity canola. And that is based on a $350 per acre cost. On a wheat canola rotation farm that works out to $50 an acre profit across the farm, as well as conservatively allowing 50 an acre land cost. So a 4000 acre guy who rents 2000 acres and owns 1000 acres free and clear and owes $1000 an acre on another 1000 acres is looking at making $250,000 in 2018. This is why rent is going up, things look good. Reply With Quote
Feb 7, 2018 | 12:51 51 Could be worse
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Feb 7, 2018 | 12:51 52 Wow.....and the Weston group is making 2000 plus per acre by price fixing..... Reply With Quote