5000ac Farm won’t buy new

[Bossfarmer]

Yes not exciting is it !

But there is capital value appreciation and tax advantage to take into account plus the numbers I mention should be the absolute worst case senario (rental equ really !(

what if land values fall?

 

[willy]

Anyone not making significant money on 5k acres of OWNED land really shouldn’t be farming - any less that 750k profit would be a poor result

Unless carrying a massive amount of debt I suspect they are more than able to afford new if they chose but as above feel they can get better return with a used machinery policy

Personally I think that you only ever really swap depreciation for repair cost so it doesn’t make a lot of difference to costs just capital requirement

Beeswax farming are screwed then

 

[Clive]

Beeswax farming are screwed then

quite an achievement to loose money on owned land but equally they must have invested fortunes in infrastructure from a scratch start

but I suspect the tax advantage outweighs any trading loss

 

[Brisel]

Beeswax farming are screwed then

Dyson has good accountants If you look into what they spend their money on, there's a considerable reinvestment in new land drainage schemes, stewardship etc. Beeswax aren't just frittering cash away on crap and new gear, they look to be investing for the future, in a tax efficient way.

 

[ajd132]

I wish people would give it a rest slagging off beeswax. They are doing all the Infrastructure stuff that no one else can afford and can you imagine the costs involved with amalgamating 30,000 acres into a single unit!?

 

[james ds]

quite an achievement to loose money on owned land but equally they must have invested fortunes in infrastructure from a scratch start

but I suspect the tax advantage outweighs any trading loss

You reinvest or pay a lot of tax , good clever accountants who plan ahead rarely pay much tax.

 

[willy]

Dyson has good accountants If you look into what they spend their money on, there's a considerable reinvestment in new land drainage schemes, stewardship etc. Beeswax aren't just frittering cash away on crap and new gear, they look to be investing for the future, in a tax efficient way.

Exactly how do you know this 5000 acre farm they are talking about isn’t investing in infrastructure or other projects, so saying that a 5000 acre farm should at least be making 750k is nonsense.......just saying

 

[willy]

I wish people would give it a rest slagging off beeswax. They are doing all the Infrastructure stuff that no one else can afford and can you imagine the costs involved with amalgamating 30,000 acres into a single unit!?

I was merely making a point to counteract Clive’s comment

 

[willy]

You reinvest or pay a lot of tax , good clever accountants who plan ahead rarely pay much tax.

You don’t have to reinvest in machinery, lots of other options more worth while probably

 

[Brisel]

Exactly how do you know this 5000 acre farm they are talking about isn’t investing in infrastructure or other projects, so saying that a 5000 acre farm should at least be making 750k is nonsense.......just saying

£750k is £150/acre net profit. Not unrealistic IMO but rather than pay tax on £750k I'd be banking that in terms of soil indices, soil health, infrastructure etc for the future when returns drop. Profits will fall in agriculture - removing BPS takes just over half that margin for a start before worrying about any trade deals or government policy.

 

[Oscar]

I agree with others saying that this buisness is thinking and acting correctly and the desire to own new metal and paint is going to have to change for everyone in the future probably.
I ve worked all over the world the last 30 years,Canada,USA,NZ,Australia ,S Africa and Europe and only in Europe was I operating "new metal ". All the other s it was 5-25 year old tractors and kit,but still doing the same job well. .All serviced and prepared out of season and worked 24/7 when needed. Most were 10000 ac plus outfits.
WAKE UP people, you can t compete with them while still wanting to buy and own new toys !

 

[Brisel]

I'll play devil's advocate here. The main reason many buy new is reliability, or the perception of reliability. In Australia you have 6 months to prepare a seedbed between the harvest of one crop and the sowing of the next so can afford a breakdown or two. Here we have around 1 month on average.

 

[ollie989898]

Can someone do the sums for monster Lexion vs two smaller used Axial flows? In terms of cost of ownership, likely repairs and also outputs? A modern Axial flow can't be that far off the pace?

 

[Clive]

Can someone do the sums for monster Lexion vs two smaller used Axial flows? In terms of cost of ownership, likely repairs and also outputs? A modern Axial flow can't be that far off the pace?

no need to do any sums if you dont have 2 drivers ! that man will cost a lot to employ and I would rather own machinery than employ more people any day of the week !

Case no cheaper really than any other brand whenever I have been quoted (new) used that might be a different matter however

 

[Clive]

I was merely making a point to counteract Clive’s comment

the 5000ac unit in the opening post is clearly not Beeswax which is significantly larger than that and as mentioned seem to be doing an amazing job of infrastructure investment for the future etc

Re the 5000 ac unit and my assessment that if they are not making 500-750k plus they should probably give up and let someone else have a go - regardless of if that is reinvested or dealt with to avoid tax etc they should be making at least that from owned acres - I wouldn't suggest anyone would be making and drawing that kind of profit a year but they should expect similar or greater ROI which as pointed out by others at approx 1.5% is hardly exciting anyway !

 

[ajd132]

Can someone do the sums for monster Lexion vs two smaller used Axial flows? In terms of cost of ownership, likely repairs and also outputs? A modern Axial flow can't be that far off the pace?

It will cost far more to run two axial flows.

 

[ollie989898]

no need to do any sums if you dont have 2 drivers ! that man will cost a lot to employ and I would rather own machinery than employ more people any day of the week !

Case no cheaper really than any other brand whenever I have been quoted (new) used that might be a different matter however

I thought Axial flows were cheap(er) to buy?

Regarding labour, a half decent student could drive it and use the settings as directed by the more senior man driving the first machine?

 

[Clive]

I thought Axial flows were cheap(er) to buy?

Regarding labour, a half decent student could drive it and use the settings as directed by the more senior man driving the first machine?

#myth ;-)

 

[Clive]

what if land values fall?

what if the sky falls in ?


stop woprrying about shite that hasn't happened you will sleep far better

 

[willy]

the 5000ac unit in the opening post is clearly not Beeswax which is significantly larger than that and as mentioned seem to be doing an amazing job of infrastructure investment for the future etc

Re the 5000 ac unit and my assessment that if they are not making 750k the should probably give up and let someone else have a go - regardless of if that is reinvested or dealt with to avoid tax etc they should be making at least that from owned acres - I wouldn't suggest anyone would be making and drawing that kind of profit a year but they should expect similar or greater ROI which as pointed out buy others at approx 1.5% is hardly exciting anyway !

So bees wax can be clever, but no one else....all I was saying was we do not know any thing about this far other than they don’t want to buy new. I say fair play to them other farms can be equally as good as bees wax. Anyone can throw money at anything if you have enough..