Can we all carry on farming?

[MrNoo]

Not everyone has convertible buildings, convenient location or appropriate ownership to do that

No, I completely understand that but to "ban" those that can from doing it seems to be a little odd.
In my case it doesnt effect me as I dont receive any income from said units, my father left them to the step mother when he died.

 

[Spud]

No, I completely understand that but to "ban" those that can from doing it seems to be a little odd.
In my case it doesnt effect me as I dont receive any income from said units, my father left them to the step mother when he died.

It does indeed

 

[7610 super q]

Very entertaining thread. Well done.

 

[DRC]

So a lot of these big farms aren’t as efficient as they’d like you to believe then. If 400 acres can make £80/100k profit, surely 4/5000 acres should be making million easily .
why aren’t they? I’m genuinely interested .

 

[ajd132]

So a lot of these big farms aren’t as efficient as they’d like you to believe then. If 400 acres can make £80/100k profit, surely 4/5000 acres should be making million easily .
why aren’t they? I’m genuinely interested .

Don’t recall anyone saying they aren’t?

 

[Clive]

I seem to recall you posting in the past that you started out on a big farm

You might not have described it as such but I seem to recall 300 acres mentioned

250 ac part tenanted dairy farm milking 100 cows . - not big by today’s standards or even then and certainly would struggle to be viable today i think

 

[Clive]

So a lot of these big farms aren’t as efficient as they’d like you to believe then. If 400 acres can make £80/100k profit, surely 4/5000 acres should be making million easily .
why aren’t they? I’m genuinely interested .

can many or any 400 acre arable farm consistently make 80-100k on RENTED land / no diversification?



or are they making that because they have 400 bought and paid for acres ?


investment returns or trading as a farmer ? BIG difference !

 

[Clive]

Why not?

it wouldn’t be viable ……… unless maybe every acre and every cow was owned / debt free and without rent or finance ………. and then my income would be coming from investment not trading

are there many 100 cow 250ac dairy units paying rent getting a good living that reflects the workload / investment and risk ? …….. I doubt it is common

 

[Clive]

UK farms are all small relatively - i do some work fir a Danish owned farm in Serbia ……. it’s 112k ha and 50k plus ha is not uncommon

Any uk farmer who things he will complete global through scale is frankly deluded

 

[Coximus]

Me thinks in comming years,people are going to get hungry, because I am not taking any more squeeze ing, I am sure as hell, not alone on that opinion, sod it I say let them go hungry.

Its an interesting topic, who is squeezed and by whom?
My twopence worth - BPS and subsidies are and were a bad thing - they allowed poor and bad farmers to stay trading, and unproductive farms to survive, and in turn they allowed farmers to sell food artificially cheap to supermarkets - in reality BPS is a massive subsidy to the supermarkets and grain buyers - this has allowed THEM to push prices down against farmers, meaning investment and quality of workforce is compromised. This has happend over 40 years - and the result is when the inevitable adjustment arrives - it will be swift and brutal and alot of innocent businesses will be caught up in it.

Personally I love the idea of being able to pay someone enough to help with the stock and land, that they could buy a house and one day their own land - but that means paying a fair wage, which is £25k minimum on a 39hour week - something that few farm businesses could afford to do - so do I chaRGE more for my produce? but will the buyers pay it? Will the public stomach the £2.50 loaf of bread and £15/kg meat? I doubt it at first as they are so used to artificially cheap food and artificially cheap energy - that post cold war economic order of hidden cost is coming to an end, and violently now.

I think at first we will be squeezed both ends and alot of weaker and less prepared businesses will fail, some due to their own inflexibility, others through no fault of their own, In years to come I hope the market will stabilize somewhere more sustainable - but what form that will take and when are up in their air, the events in Ukraine now - the bread and fertilizer basket of the west , will still be felt in our pockets and fields in 15 to 20 years time.

 

[DrWazzock]

On 200 acres we made £40k profit to March 21 including BPS which was about half of it.
I wouldn’t say we are pushing it or fully focussed either due to a lot of distractions, health issues etc. No rent or borrowings.
It is what it is. Apart from massively fluctuating prices and shortages our biggest underlying risk is the ageing machinery fleet, refurbishment of which takes more and more time and money.
One and a half of us working here but we aren’t really full time at it. We have had a run of poorly family members over the last decade which eats up time and energy. It’s never plain sailing.
Anyway only real option is either carry on pottering on or let it or sell it. Not great land. But lovely place to live. Hey ho.
If I won the lottery I wouldn’t buy land, put it that way. I’ve had a good run at it. More to life quite frankly but still need to earn a living for another 20 years one way or another.

 

[ajd132]

Is everyone including a true cost for their own and family labour - income forgone aswell?
IMO has to be at least 50k minimum.

 

[E_B]

Completely irrelevant to talk about profit per acre IMO. Intangibles like tenancy type, borrowing costs, non linear accurate depreciation, inflation, connected diversifications, marketing, access to markets, family labour, soil type, etc makes it a meaningless exercise.

£100k profit off a 400acre rented arable farm would be a hell of an achievement though, if accurate.

 

[ajd132]

Completely irrelevant to talk about profit per acre IMO. Intangibles like tenancy type, borrowing costs, non linear accurate depreciation, inflation, connected diversifications, marketing, access to markets, family labour, soil type, etc makes it a meaningless exercise.

£100k profit off a 400acre rented arable farm would be a hell of an achievement though, if accurate.

agree, very hard to do a true comparison as so many irregularities in the metric between different businesses.

 

[Tarw Coch]

250 ac part tenanted dairy farm milking 100 cows . - not big by today’s standards or even then and certainly would struggle to be viable today i think

That ought to be viable today but might not provide a lavish living.
I have a mate milking 70 cows on a rented farm, investing in buildings/concrete himself and has a new tractor every 3 years.

Things don’t stand still, anyone doing the same today as they were 25 years ago is unlikely to be doing as well as they were back then To that end, we can’t all carry on farming if remaining viable into the future means needing to expand . in reality, anyone standing still is slipping backwards

But I ceratainly wouldn’t say you came from a small start, certainly not in the context of this country and the time. No doubt you have done extremely well for yourself although I’m totally unaware of exactly how far your buisness and buisness interests has come the snippets I read on here shows you’ve come a long way.
If you ever fancied hosting a TFF farm walk I’m sure your story would make a fascinating evening.

I have known a couple of farmers similarly successful in my lifetime, one of an older generation now passed away, from his fathers 27scre holding to approx 10,000 acres and another of my generation, son of a county council tenant milking about 800 cows, a building buisness, the largest contracting buisness in the area, broilers, hospitality and rumoured to be the backer os some other buisnesses.
Both very down to earth and interesting people to talk to, but that sort of success is very much the exception

 

[D14]

Yep owned by other people, you are hoping/ expecting that even more farmers will be forced out so will let you farm their land for very little rent!

The base line is ELMS though isn't it. If a farmer decides he no longer wants to farm he then goes full speed into ELMS going into every single option he can. He'll end up with a set figure per acre. If the contract farming boys don't offer more over the top of it then they will loose out. Simple as that. The days of landowners/farmers thinking their land must be farmed to keep it looking nice are long gone.

 

[ajd132]

The base line is ELMS though isn't it. If a farmer decides he no longer wants to farm he then goes full speed into ELMS going into every single option he can. He'll end up with a set figure per acre. If the contract farming boys don't offer more over the top of it then they will loose out. Simple as that. The days of landowners/farmers thinking their land must be farmed to keep it looking nice are long gone.

absolutely right. my aim is to farm in a way which can maximise the crop, elms and carbon. if that isnt enough and they want to put the whole thing into enviro schemes than thats absolutely fair enough. nothing stays the same

 

[D14]

The contractor gets paid first whatever which is I think where the risk thing is covered.

If I decided to go down the cfa route then I would be making sure I was paid first as its the 'rent' I am interested in. Then the contract farmer does all the management, grows what he wants and takes all the risk. It might well be a FBT I describe but it wouldn't be for inheritance tax reasons thinking about my children.

 

[ajd132]

If I decided to go down the cfa route then I would be making sure I was paid first as its the 'rent' I am interested in. Then the contract farmer does all the management, grows what he wants and takes all the risk. It might well be a FBT I describe but it wouldn't be for inheritance tax reasons thinking about my children.

then its a sham and technically illegal

 

[unlacedgecko]

I had a local friend ask me last week would I take his 250ac on (land only) and he keeps the yard for himself and how much would I pay. I sat down for a couple of hours and kept coming back to £0/ac for the rent because of the current input cost and fuel price issues, then he keeps the subsidy till it ends to ride out this current storm. Then after that we sit down and sort it out.
If I could grow 1st wheat all over it every year then it’s worth 0.5t/ac ‘rent’ I guess but I can’t and all other crops are crap . Can’t grow osr because it’s had so much the last 30 years and it’s not ‘root’ ground. Grass it down and it’s maybe worth £50/acre for sheep so maybe 50% wheat and 50% short term ley?

Unless it's properly stock fenced it's not worth anything for sheep grazing.