I tried a few searches last night but couldn't find it. It is a classic.
Stubble to stubble rates
- Thread starter midlandslad
- Start date
I tried a few searches last night but couldn't find it. It is a classic.
SilliamWhale
Member
Even so arguably isn't Tesla living the life now at the same age that you want to have in 20 years time?
Steevo
Member
- Location
- Gloucestershire
May I ask what your brother/father are doing now?
Are they as glad as you to have stepped of the hamster wheel?
I need more to get me out of bed than Tesla does, clearly. I'll be doing more in 20yrs (by choice) than he is now. It's about more than brass, as I said earlier.
Found it
I would quite like to expand but i am often coming up against contract farmers who seem to want to farm half the world and will pay stupidly high rents to do it. In my view if the rent doesn't stack up on its own its too dear.. end of. I'd rather they make a loss than me!
So lets take our (very lucky!) farmer who owns a 1000ac with no borrowing and insert some basic figures. I will call him Bob and I will assume a uniform (very optimistic!) profit level and that economies of scale are already achieved at the 1000ac level so there will not be any real cost benefits of increasing in size.
So,
Things are going well for Bob and he makes £200/ac profit after all fixed/variable costs on average across his 1000ac giving him a total profit of £200,000 a year.
1000ac next door comes up for rent at £120/ac, he'd be a fool not to take it!, so Bob does and spreads the rent of £120,000/yr across his 2000ac. Works out at £60/ac and assuming that everything is still going great and he makes a profit of £140/ac across both units and earns a very tidy £280,000 a year. His percentage profit has dipped and he is doing more work, but hey lets not worry about such things his turnover's gone up and he has more land than any of his neighbours!
Through kissing some land agent's behind he then gets his big chance, 2500ac almost half the local estate! Its £200/ac with no sfp. Bob's pleased, he would have gone to £300/ac, the lands worth £12,500/ac after all and his Grace deserves to make money as much as the next guy (Bob doesn't realise that his Grace's family got the land many years ago for killing one of the King's rivals so it didn't really cost them anything). He will now have 4,500ac! So Bob dives right in on a 15 year lease!
Bob now has 4500 ac, more land than anyone in the county. He has a total rent now of £620,000/yr or £137/ac. So what?!? £137 is less than a tonne of wheat so it doesn't matter.
Conditions remain the same in year three, so he makes a profit now of £63/ac across all 4500ac, a tidy profit of!!... £283,500... hhmm. Bob is only making £3,500 more than last year on 125% more turnover.. But so what! Bob now has 4,500ac and he just bought 2 Lexion 770's... and built a new £500,000 grain store, he's now got a website and gives talks to fellow farmers.. he's the envy of all his neighbours... And he's on Mr Claas's xmas card list! He gets to shoot with his Grace! (even if it is just the keepers day) His Grace loves Bob, (he calls him his 'tame farmer') he has never had so much spare cash and doesn't have to deal with those pesky tenants anymore! If Bob keeps in with him he might get the rest of the estate, Bob will definitely go to £300/ac to get all that land, Bob'll have 7000ac soon!
Year 4 comes along, its a wet one, the crops were sown in poor conditions and come harvest he is struggling to cut 4500ac.. even with his two Lexion 770's! in his head he would have been done combining in less than 15 days cutting (even with all those small fields and road miles required) but they won't cut much when its raining or their bogged or got a power washer up their spouts to wash the mud out.
The wheat price has also dropped, and that combined with slug pellets costs and breakdowns means that his notional profit before rent comes back to £100/ac, and at the end of the year he goes from a £63/ac or £283,500 profit in year 3 to a loss of -£37/ac and a total loss of -£166,500 in year 4.... and thats before taking into account the Lexion 580 that he had to buy to get the wheat cut before it sprouted... but thats not too important it only cost £180,000!?!.. All that for about 4 times the work he used to do!! He decides to pass on the rest of the estate.
The cereal market then gets more volatile for the next few years (unfortunately Bob has to sell forwards every year to keep the bank manager happy so he can't be fussy about prices) and other costs go through the roof, he's still got 13 years of his lease to go and wishes he had never seen the 2,500ac. When he eventually gets out of the lease he now owes the bank so much that they tell him if he ever tries taking on more land they will call in the loans and shut him down. His Grace gets some new tenants, hopefully they wont mind the derelict steadings.. Progress eh!
Found here on post 5 https://thefarmingforum.co.uk/index.php?threads/£250-acre-rent-question.99754/#post-2007566 by @le bon paysan
Steevo
Member
- Location
- Gloucestershire
Found it
I would quite like to expand but i am often coming up against contract farmers who seem to want to farm half the world and will pay stupidly high rents to do it. In my view if the rent doesn't stack up on its own its too dear.. end of. I'd rather they make a loss than me!
So lets take our (very lucky!) farmer who owns a 1000ac with no borrowing and insert some basic figures. I will call him Bob and I will assume a uniform (very optimistic!) profit level and that economies of scale are already achieved at the 1000ac level so there will not be any real cost benefits of increasing in size.
So,
Things are going well for Bob and he makes £200/ac profit after all fixed/variable costs on average across his 1000ac giving him a total profit of £200,000 a year.
1000ac next door comes up for rent at £120/ac, he'd be a fool not to take it!, so Bob does and spreads the rent of £120,000/yr across his 2000ac. Works out at £60/ac and assuming that everything is still going great and he makes a profit of £140/ac across both units and earns a very tidy £280,000 a year. His percentage profit has dipped and he is doing more work, but hey lets not worry about such things his turnover's gone up and he has more land than any of his neighbours!
Through kissing some land agent's behind he then gets his big chance, 2500ac almost half the local estate! Its £200/ac with no sfp. Bob's pleased, he would have gone to £300/ac, the lands worth £12,500/ac after all and his Grace deserves to make money as much as the next guy (Bob doesn't realise that his Grace's family got the land many years ago for killing one of the King's rivals so it didn't really cost them anything). He will now have 4,500ac! So Bob dives right in on a 15 year lease!
Bob now has 4500 ac, more land than anyone in the county. He has a total rent now of £620,000/yr or £137/ac. So what?!? £137 is less than a tonne of wheat so it doesn't matter.
Conditions remain the same in year three, so he makes a profit now of £63/ac across all 4500ac, a tidy profit of!!... £283,500... hhmm. Bob is only making £3,500 more than last year on 125% more turnover.. But so what! Bob now has 4,500ac and he just bought 2 Lexion 770's... and built a new £500,000 grain store, he's now got a website and gives talks to fellow farmers.. he's the envy of all his neighbours... And he's on Mr Claas's xmas card list! He gets to shoot with his Grace! (even if it is just the keepers day) His Grace loves Bob, (he calls him his 'tame farmer') he has never had so much spare cash and doesn't have to deal with those pesky tenants anymore! If Bob keeps in with him he might get the rest of the estate, Bob will definitely go to £300/ac to get all that land, Bob'll have 7000ac soon!
Year 4 comes along, its a wet one, the crops were sown in poor conditions and come harvest he is struggling to cut 4500ac.. even with his two Lexion 770's! in his head he would have been done combining in less than 15 days cutting (even with all those small fields and road miles required) but they won't cut much when its raining or their bogged or got a power washer up their spouts to wash the mud out.
The wheat price has also dropped, and that combined with slug pellets costs and breakdowns means that his notional profit before rent comes back to £100/ac, and at the end of the year he goes from a £63/ac or £283,500 profit in year 3 to a loss of -£37/ac and a total loss of -£166,500 in year 4.... and thats before taking into account the Lexion 580 that he had to buy to get the wheat cut before it sprouted... but thats not too important it only cost £180,000!?!.. All that for about 4 times the work he used to do!! He decides to pass on the rest of the estate.
The cereal market then gets more volatile for the next few years (unfortunately Bob has to sell forwards every year to keep the bank manager happy so he can't be fussy about prices) and other costs go through the roof, he's still got 13 years of his lease to go and wishes he had never seen the 2,500ac. When he eventually gets out of the lease he now owes the bank so much that they tell him if he ever tries taking on more land they will call in the loans and shut him down. His Grace gets some new tenants, hopefully they wont mind the derelict steadings.. Progress eh!
Found here on post 5 https://thefarmingforum.co.uk/index.php?threads/£250-acre-rent-question.99754/#post-2007566 by @le bon paysan
Well done!
Love it, a very good lesson for both farmers and land owners!Found it
I would quite like to expand but i am often coming up against contract farmers who seem to want to farm half the world and will pay stupidly high rents to do it. In my view if the rent doesn't stack up on its own its too dear.. end of. I'd rather they make a loss than me!
So lets take our (very lucky!) farmer who owns a 1000ac with no borrowing and insert some basic figures. I will call him Bob and I will assume a uniform (very optimistic!) profit level and that economies of scale are already achieved at the 1000ac level so there will not be any real cost benefits of increasing in size.
So,
Things are going well for Bob and he makes £200/ac profit after all fixed/variable costs on average across his 1000ac giving him a total profit of £200,000 a year.
1000ac next door comes up for rent at £120/ac, he'd be a fool not to take it!, so Bob does and spreads the rent of £120,000/yr across his 2000ac. Works out at £60/ac and assuming that everything is still going great and he makes a profit of £140/ac across both units and earns a very tidy £280,000 a year. His percentage profit has dipped and he is doing more work, but hey lets not worry about such things his turnover's gone up and he has more land than any of his neighbours!
Through kissing some land agent's behind he then gets his big chance, 2500ac almost half the local estate! Its £200/ac with no sfp. Bob's pleased, he would have gone to £300/ac, the lands worth £12,500/ac after all and his Grace deserves to make money as much as the next guy (Bob doesn't realise that his Grace's family got the land many years ago for killing one of the King's rivals so it didn't really cost them anything). He will now have 4,500ac! So Bob dives right in on a 15 year lease!
Bob now has 4500 ac, more land than anyone in the county. He has a total rent now of £620,000/yr or £137/ac. So what?!? £137 is less than a tonne of wheat so it doesn't matter.
Conditions remain the same in year three, so he makes a profit now of £63/ac across all 4500ac, a tidy profit of!!... £283,500... hhmm. Bob is only making £3,500 more than last year on 125% more turnover.. But so what! Bob now has 4,500ac and he just bought 2 Lexion 770's... and built a new £500,000 grain store, he's now got a website and gives talks to fellow farmers.. he's the envy of all his neighbours... And he's on Mr Claas's xmas card list! He gets to shoot with his Grace! (even if it is just the keepers day) His Grace loves Bob, (he calls him his 'tame farmer') he has never had so much spare cash and doesn't have to deal with those pesky tenants anymore! If Bob keeps in with him he might get the rest of the estate, Bob will definitely go to £300/ac to get all that land, Bob'll have 7000ac soon!
Year 4 comes along, its a wet one, the crops were sown in poor conditions and come harvest he is struggling to cut 4500ac.. even with his two Lexion 770's! in his head he would have been done combining in less than 15 days cutting (even with all those small fields and road miles required) but they won't cut much when its raining or their bogged or got a power washer up their spouts to wash the mud out.
The wheat price has also dropped, and that combined with slug pellets costs and breakdowns means that his notional profit before rent comes back to £100/ac, and at the end of the year he goes from a £63/ac or £283,500 profit in year 3 to a loss of -£37/ac and a total loss of -£166,500 in year 4.... and thats before taking into account the Lexion 580 that he had to buy to get the wheat cut before it sprouted... but thats not too important it only cost £180,000!?!.. All that for about 4 times the work he used to do!! He decides to pass on the rest of the estate.
The cereal market then gets more volatile for the next few years (unfortunately Bob has to sell forwards every year to keep the bank manager happy so he can't be fussy about prices) and other costs go through the roof, he's still got 13 years of his lease to go and wishes he had never seen the 2,500ac. When he eventually gets out of the lease he now owes the bank so much that they tell him if he ever tries taking on more land they will call in the loans and shut him down. His Grace gets some new tenants, hopefully they wont mind the derelict steadings.. Progress eh!
Found here on post 5 https://thefarmingforum.co.uk/index.php?threads/£250-acre-rent-question.99754/#post-2007566 by @le bon paysan
Steevo
Member
- Location
- Gloucestershire
Anyone fancy putting a guess on how many man-hours that would be?
Probably depends on the size of the kit. But I don’t think there would be any profit in it if the job was done without cutting corners.
- Location
- East meath/dublin
Teagasc data indicates that the top 20 % of Dairy farmers can produce milk for 21 cent litre .
The secret of success is cost control as inall things
Some people could lose money goldmining !!!
- Location
- Lincolnshire
It's not a competition.
My daddy is farming. My brother is farming. We all live next door. Our farms are seperate, and run by ourselves. No annoying family sort outs in years to come. We all run our units very differently. But if one needs a bit of spraying done, a lorry loading, some ditching done then we all help out.
My daddy is farming. My brother is farming. We all live next door. Our farms are seperate, and run by ourselves. No annoying family sort outs in years to come. We all run our units very differently. But if one needs a bit of spraying done, a lorry loading, some ditching done then we all help out.
That's the way it should be, I guess fortunately for you the cake was large enough so that each of you could have a a big enough slice that you weren't still hungry
Perhaps an ignorant question from me, but I don’t know anything about the economics of dairy, but what has changed in the dairy industry in the last decade? I can remember the mainstream press and news frequently reporting on the plight of dairy farmers. Is it just a case of the buyers have had to up their game to keep a viable industry supplying them or other factors too?Rest assured, dairy is where the money's at!
If you want to.
Bossfarmer
Member
- Location
- between Perth and Inverness
i dont understand cents just give us a rough net profit per acre figure for dairy, at 860 for wheat that should leave roughly £460/acre net?Do the maths boss !!! One acre of wheat doing 4 ton acre at 200 a ton is 800 acre , say 60 quid for the straw and gross output is 860 .
Now say an acre of grass supporting a holstien cross giving 8000 litres at 36 cent litre average thats ...... my brain is fuccked you can work it out !!!
Oh a cow to the acre would be on the low side were more like two acre .
When are you starting the parlour ????
Bossfarmer
Member
- Location
- between Perth and Inverness
what happens to bob when wheat hits £220/t?Found it
I would quite like to expand but i am often coming up against contract farmers who seem to want to farm half the world and will pay stupidly high rents to do it. In my view if the rent doesn't stack up on its own its too dear.. end of. I'd rather they make a loss than me!
So lets take our (very lucky!) farmer who owns a 1000ac with no borrowing and insert some basic figures. I will call him Bob and I will assume a uniform (very optimistic!) profit level and that economies of scale are already achieved at the 1000ac level so there will not be any real cost benefits of increasing in size.
So,
Things are going well for Bob and he makes £200/ac profit after all fixed/variable costs on average across his 1000ac giving him a total profit of £200,000 a year.
1000ac next door comes up for rent at £120/ac, he'd be a fool not to take it!, so Bob does and spreads the rent of £120,000/yr across his 2000ac. Works out at £60/ac and assuming that everything is still going great and he makes a profit of £140/ac across both units and earns a very tidy £280,000 a year. His percentage profit has dipped and he is doing more work, but hey lets not worry about such things his turnover's gone up and he has more land than any of his neighbours!
Through kissing some land agent's behind he then gets his big chance, 2500ac almost half the local estate! Its £200/ac with no sfp. Bob's pleased, he would have gone to £300/ac, the lands worth £12,500/ac after all and his Grace deserves to make money as much as the next guy (Bob doesn't realise that his Grace's family got the land many years ago for killing one of the King's rivals so it didn't really cost them anything). He will now have 4,500ac! So Bob dives right in on a 15 year lease!
Bob now has 4500 ac, more land than anyone in the county. He has a total rent now of £620,000/yr or £137/ac. So what?!? £137 is less than a tonne of wheat so it doesn't matter.
Conditions remain the same in year three, so he makes a profit now of £63/ac across all 4500ac, a tidy profit of!!... £283,500... hhmm. Bob is only making £3,500 more than last year on 125% more turnover.. But so what! Bob now has 4,500ac and he just bought 2 Lexion 770's... and built a new £500,000 grain store, he's now got a website and gives talks to fellow farmers.. he's the envy of all his neighbours... And he's on Mr Claas's xmas card list! He gets to shoot with his Grace! (even if it is just the keepers day) His Grace loves Bob, (he calls him his 'tame farmer') he has never had so much spare cash and doesn't have to deal with those pesky tenants anymore! If Bob keeps in with him he might get the rest of the estate, Bob will definitely go to £300/ac to get all that land, Bob'll have 7000ac soon!
Year 4 comes along, its a wet one, the crops were sown in poor conditions and come harvest he is struggling to cut 4500ac.. even with his two Lexion 770's! in his head he would have been done combining in less than 15 days cutting (even with all those small fields and road miles required) but they won't cut much when its raining or their bogged or got a power washer up their spouts to wash the mud out.
The wheat price has also dropped, and that combined with slug pellets costs and breakdowns means that his notional profit before rent comes back to £100/ac, and at the end of the year he goes from a £63/ac or £283,500 profit in year 3 to a loss of -£37/ac and a total loss of -£166,500 in year 4.... and thats before taking into account the Lexion 580 that he had to buy to get the wheat cut before it sprouted... but thats not too important it only cost £180,000!?!.. All that for about 4 times the work he used to do!! He decides to pass on the rest of the estate.
The cereal market then gets more volatile for the next few years (unfortunately Bob has to sell forwards every year to keep the bank manager happy so he can't be fussy about prices) and other costs go through the roof, he's still got 13 years of his lease to go and wishes he had never seen the 2,500ac. When he eventually gets out of the lease he now owes the bank so much that they tell him if he ever tries taking on more land they will call in the loans and shut him down. His Grace gets some new tenants, hopefully they wont mind the derelict steadings.. Progress eh!
Found here on post 5 https://thefarmingforum.co.uk/index.php?threads/£250-acre-rent-question.99754/#post-2007566 by @le bon paysan
He has an okay year (almost as good as he used to be doing half the work), then his rent, machinery and input costs goes up.