Debt

[Kiwi Pete]

Shows void between Arable and Livestock

Maybe.
Personally I believe all high-input farming has shot itself in the foot by pricing it's own operation out of the park, so to speak.

It's merely a matter of time before all sectors have to accept that they aren't actually subsidised, but merely paid off - and adjust appropriately to let the market/farmgate price decide their expenditure, instead of some belief that things will improve of their own accord?

Returns do not permit a whole brace of machinery to be maintained, but the brace of machinery is an integral part of systems.
You don't need a degree to work out the trajectory of a farming system that lacks the adaptability of production costs to suit returns.

 

[DRC]

I’d love to know how everyone knows other farmers debt. Mostly it’s what people would like to believe . I wouldn’t have a clue what sort of debt any of my neighbours have.

 

[Y Fan Wen]

I’d love to know how everyone knows other farmers debt. Mostly it’s what people would like to believe . I wouldn’t have a clue what sort of debt any of my neighbours have.

Comment by the finance lecturer at college many years ago;
'When you look over the hedge, you don't see the balance sheet'.

 

[Kiwi Pete]

I’d love to know how everyone knows other farmers debt. Mostly it’s what people would like to believe . I wouldn’t have a clue what sort of debt any of my neighbours have.

Mostly it's "seasonal finance" that my neighbour's mention.
It's what happens on most livestock farms around me, because their costs are spread out across the year and the income all happens in a few months - usually in the $50,000 overdraft bracket so not immense or costly to have compared to the alternative: have a year off spending money to maintain enough cash reserve to last them through.
There generally isn't enough fat on the back for that, hence the loan

 

[Derrick Hughes]

I’d love to know how everyone knows other farmers debt. Mostly it’s what people would like to believe . I wouldn’t have a clue what sort of debt any of my neighbours have.

Anyone who trades with them will have an idea I would have thought
Like quite a few farm contractors live hand to mouth also

 

[livestock 1]

Anyone who trades with them will have an idea I would have thought

That might not be the full story. Maybe they don’t have a correct size borrowing option? Maybe they just don’t part with it until it comes in who knows?

 

[Y Fan Wen]

Are there any official statistics about farm debt? I have heard someone say that 1/3 of farming businesses are debt free according to some digging he did.

 

[Derrick Hughes]

That might not be the full story. Maybe they don’t have a correct size borrowing option? Maybe they just don’t part with it until it comes in who knows?

Ask anyone who manages a farm Coop how much more difficult it has become to get money in .you get a feel for these things .
You cant go on figures as a whole . Arable farmers obviously need to be taken out

 

[DRC]

Ask anyone who manages a farm Coop how much more difficult it has become to get money in .you get a feel for these things .
You cant go on figures as a whole . Arable farmers obviously need to be taken out

Why arable farmers.? Their costs would be a lot more than many livestock farms that could manage extensively with very little machinery and permanent grass .

 

[7610 super q]

Take out large scale arable farmers if you want......
The price of grain is only just over COP, and the straw market is a roller coaster every year.
It's pretty dire for us small scale arable farmers most years. Perhaps 2 years out of 10 it's OK ?

 

[Derrick Hughes]

Why arable farmers.? Their costs would be a lot more than many livestock farms that could manage extensively with very little machinery and permanent grass .

I'm not defending dairy farmers but . They have had two terrible years weather wise and TB and just getting worse + thevmilk price has been below the cost of production at times , you cant manage 400 to a,1000 cows extensively can you . And small herds no longer pay

 

[Clive]

Combinable crop prices have been WAY above COP for as many years as I can recall

If some choose to continue paying more than they need to for inputs (so many examples on TFF over the years) then they only have theirselves to blame.

As for scale - the lowest fixed cost farms are the smaller family run, low debt, well depreciated kit family labour ones - this idea that big arable farms are more efficient is utter rubbish

 

[S J H]

In the last ten years or so.....

Cost of feed near doubled

Cost of fertiliser near doubled

Cost of seed more than doubled

Cost of fuel near doubled

Cost of machinery more than doubled

Price of lamb lower

Price of beef lower

Debt?

Us livestock hill farmers are buggered when the subsidy goes, that's for certain.

Our hobby just won't be affordable any longer

Sorry to simplify it but why does a hill farmer in a ring fence have higher costs than me farming near bedford?

 

[Derrick Hughes]

Sorry to simplify it but why does a hill farmer in a ring fence have higher costs than me farming near bedford?

It would be his returns rather than his costs

 

[Still Farming]

So many variables and possibilities you can not generalize .

 

[Tarw Coch]

Combinable crop prices have been WAY above COP for as many years as I can recall

If some choose to continue paying more than they need to for inputs (so many examples on TFF over the years) then they only have theirselves to blame.

As for scale - the lowest fixed cost farms are the smaller family run, low debt, well depreciated kit family labour ones - this idea that big arable farms are more efficient is utter rubbish

The grass is allways greener the other side of the fence, be it the smaller farmer with little if any staff costs and lower value machinery or the large scale producer with his economies of scale and efficient machinery .

 

[DRC]

And some of us are tenants . A decent mans salary goes off farm here to the landlord, so owner occupiers must be doing alright

 

[Werzle]

I have always worked on a little bit of my own is alot better than alot of someones elses when it comes to money/borrowing. Also if the bank lends you a million , its your problem. If the bank lends you five million, its there problem!

 

[An Gof]

Combinable crop prices have been WAY above COP for as many years as I can recall

If some choose to continue paying more than they need to for inputs (so many examples on TFF over the years) then they only have theirselves to blame.

As for scale - the lowest fixed cost farms are the smaller family run, low debt, well depreciated kit family labour ones - this idea that big arable farms are more efficient is utter rubbish

Depends whose COP you are talking about.
AHDB benchmarking results paint a rather different picture.
Congratulations to you Clive for running such an efficient business, but not everyone is as clever or fortunate as you and they have to work with the cards they have been dealt.

 

[Clive]

Depends whose COP you are talking about.
AHDB benchmarking results paint a rather different picture.
Congratulations to you Clive for running such an efficient business, but not everyone is as clever or fortunate as you and they have to work with the cards they have been dealt.

We all have to work with the cards we are dealt .......... there was certainly nothing remarkable about my hand !

We have to face facts - there are some bloody good farmers that are unfortunately terrible businessmen and you simply can not expect to survive in ANY business unless you run it as such

... and you certainly can’t ask the tax payer to subsidise it !

The AHDB benchmarking is not a “how to”. All it does is prove my points above rather well