Renting Land to Grow Winter Barley

[DrWazzock]

I reckon it costs me £300 per acre to grow winter barley.
(Seed and Chems £80, Fert £120, stubble to stubble work £100 at least).

That is with plough/power harrow system on difficult grade 3 land having a mix of yellow clay and blow away sand.

With yield of 3 tonnes/ acre at best and say £120 per tonne that's £360 per acre gross leaving me £60 per acre for my trouble.

With the landlord keeping the SP, the rent should be zero, shouldn't it?

Difficult to get folks to see this though when people are flying around offering £150 per acre.

 

[Derrick Hughes]

If I rented you my arable land this back end that's a good grass ley who would pay the £200 to put it back to grass when you have finished

A good dairy farm will pay Handsom money to take 4 cuts of silage and no extras to find

Thanks for your costing , I gave up wheat 5 years ago for the same reason, margin did not justify the investment

 

[DrWazzock]

I can understand higher rents for beet if the factory is doing it direct, or potatoes or peas etc, but for standard combinables like cereals or OSR, beans etc it just does not add up, yet rents seem well over £100 per acre. OK if its 4 tonne wheat land perhaps, but not for grade 3.

 

[Andy26]

I guess a percentage of the stubble to stubble cost will be your labour etc.

Is Barley as low as £120 for next harvest?

Are the £150 Rent offers not including SFP? Making it about £65/acre without.

 

[DRC]

Sold my barley straw for £85/ acre, but agree that the rents heard about are unsustainable.
Land next to me went for £170, with no SFP.

 

[franklin]

I reckon it costs me £300 per acre to grow winter barley.
(Seed and Chems £80, Fert £120, stubble to stubble work £100 at least).

That is with plough/power harrow system on difficult grade 3 land having a mix of yellow clay and blow away sand.

With yield of 3 tonnes/ acre at best and say £120 per tonne that's £360 per acre gross leaving me £60 per acre for my trouble.

With the landlord keeping the SP, the rent should be zero, shouldn't it?

Difficult to get folks to see this though when people are flying around offering £150 per acre.

Anyone taking on the land with existing kit and staff will put the cost of the work as pretty much the diesel and a few hours of time irrespective of your thoughts on this. They certainly wont be putting any P&K on and will be using two splits of urea which will get fert down 150kg/ha of urea is a fraction of £120/ac . The straw will be sold. They will factor in the following crop of OSR which is a much better payer.

£170 rent with no SFP would be considered steep around here on the clay. £75-80 with no SFP sounds about fair enough.

But when has fair got anything to do with it.

 

[DrWazzock]

Anyone taking on the land with existing kit and staff will put the cost of the work as pretty much the diesel and a few hours of time irrespective of your thoughts on this. They certainly wont be putting any P&K on and will be using two splits of urea which will get fert down 150kg/ha of urea is a fraction of £120/ac . The straw will be sold. They will factor in the following crop of OSR which is a much better payer.

£170 rent with no SFP would be considered steep around here on the clay. £75-80 with no SFP sounds about fair enough.

But when has fair got anything to do with it.

The cost of the work as being the diesel and a few hours of time is where people are mistaken IMO. The kit wears out and has to be replaced eventually. People don't seem to be factoring this into their calculations. Same with machinery rings and doing a bit for neighbours. we have fallen into this trap before. Suddenly the machine's clapped out, it's covered the diesel, spares and drivers time but nowt to replace it.

Not putting P on might work on the land round here, but leaving out the K would be a bit disastrous where levels seem to reset to well below index 1 on the sands through a wet winter.

And what about pH and drainage status? All adds up does it not? But folks in a bidding war before they have even visited the field. Crazy.

I still reckon rent should be zero on grade 3 for most combinables with landlord getting SFP.

 

[Derrick Hughes]

Yup may well think that , but you living a dream

 

[bobk]

I've come to the conclusion it's better to grow wheat ,sell it and buy the barley in

 

[DrWazzock]

Of grow nothing, sell forward at the right price and buy it in cheap at harvest time.

 

[franklin]

The cost of the work as being the diesel and a few hours of time is where people are mistaken IMO. The kit wears out and has to be replaced eventually. People don't seem to be factoring this into their calculations. Same with machinery rings and doing a bit for neighbours. we have fallen into this trap before. Suddenly the machine's clapped out, it's covered the diesel, spares and drivers time but nowt to replace it.

Not putting P on might work on the land round here, but leaving out the K would be a bit disastrous where levels seem to reset to well below index 1 on the sands through a wet winter.

And what about pH and drainage status? All adds up does it not? But folks in a bidding war before they have even visited the field. Crazy.

I still reckon rent should be zero on grade 3 for most combinables with landlord getting SFP.

Whilst I agree on the costings part, think you can rent land at say £60 over SFP, factor in your kit costs and still make a reasonable return.

I also agree on the P&K, however if you ask a landlord if they would take a) replacement P&K or b) an extra £35/ac cash they will take option b. Because at the end of the day, land with very low P&K indicies does not seem to rent or sell at a discount to those with higher. While I see land that is tendered with clauses that say you have to maintain P&K this is something that is hard to actually measure.

Fact is that around here you pay £60/ac for grass without SFP, and the only ones paying less for arable are the old AHA tenants.

 

[Steevo]

Anyone thinking they can pay less rent than £200/ac (inc SFP) isn't living in the real world of today's FBT's.

Anyone thinking they can AFFORD to pay a rent of £200/ac and above (inc SFP) to grow combinables like everyone else just isn't living in the real world. 99% of us can't make sums stack up at those sort of levels unfortunately. It's the guys with "different" businesses that can afford to rent land.

Anyone who thinks rents are expensive at £200/ac isn't a landlord. A return on investment of 2.5% isn't unreasonable and really it should be at least that given instant access building society accounts are currently about 1.75% (insultingly low but exceptional!) yet really deserve to be 5% given inflation.


The trouble with all of the above...? There isn't the margin in farming that there should be because food is artificially cheap and there are too many people wanting to farm land, regardless of whether the sums stack up and make your business more profit per farmed acre (note: not just a bigger bottom line overall!)

 

[nick channer]

Sold my barley straw for £85/ acre, but agree that the rents heard about are unsustainable.
Land next to me went for £170, with no SFP.

I really fail to see how barley straw can make this much in swath.. it can be bought most yrs at less money in the bale with no risk or hassle..
barley straw is less than £50 ton in south at min ex farm baled...

 

[Tarw Coch]

I really fail to see how barley straw can make this much in swath.. it can be bought most yrs at less money in the bale with no risk or hassle..
barley straw is less than £50 ton in south at min ex farm baled...

And there i was thinking Silverfox had sold his straw cheap allthough i didn't see the crop. The price in the south is irrelevant to me, it's what it's costing in my yard that counts.

 

[DRC]

And there i was thinking Silverfox had sold his straw cheap allthough i didn't see the crop. The price in the south is irrelevant to me, it's what it's costing in my yard that counts.

We were both at Montford Bridge sale, when wheat and barley was making over £100/acre.
My customer agreed £90/acre, but in the interests of him coming back next year, and no commission,i knocked a fiver off when he paid me.

 

[DrWazzock]

Anyone thinking they can pay less rent than £200/ac (inc SFP) isn't living in the real world of today's FBT's.

Anyone thinking they can AFFORD to pay a rent of £200/ac and above (inc SFP) to grow combinables like everyone else just isn't living in the real world. 99% of us can't make sums stack up at those sort of levels unfortunately. It's the guys with "different" businesses that can afford to rent land.

Anyone who thinks rents are expensive at £200/ac isn't a landlord. A return on investment of 2.5% isn't unreasonable and really it should be at least that given instant access building society accounts are currently about 1.75% (insultingly low but exceptional!) yet really deserve to be 5% given inflation.


The trouble with all of the above...? There isn't the margin in farming that there should be because food is artificially cheap and there are too many people wanting to farm land, regardless of whether the sums stack up and make your business more profit per farmed acre (note: not just a bigger bottom line overall!)

I think you are right. I can understand why people would buy land even if they are losing money farming it (for inheritance tax reasons, security etc) but renting it on FBTs to lose money from "other businesses" seems like madness to me, although that's what seems to be happening.

As a farmer I am looking at any other business but farming as with unpredictable weather difficulties, high inputs for not very sparkling output prices I don't find it much of an investment.

 

[Derrick Hughes]

And there i was thinking Silverfox had sold his straw cheap allthough i didn't see the crop. The price in the south is irrelevant to me, it's what it's costing in my yard that counts.

There is stacks of straw throughout the country that can't be moved as it was to dear in the swath, time will tell if they ever recover their money , but they hopefully have had their fingers burn well enough that they will keep them in their pockets next year

 

[Tarw Coch]

There is stacks of straw throughout the country that can't be moved as it was to dear in the swath, time will tell if they ever recover their money , but they hopefully have had their fingers burn well enough that they will keep them in their pockets next year

You could be right, at the sale i bought at i was the only farmer buying straw to use myself, the others were merchants or farmers who dabble in selling straw. So whilst i've had a decent margin for hauling straw home i'm not so sure it would be woth it to haul it for someone else especially as some, not mine, got rained on.

However i only bought 3/4's of the acreage i usually do so now not sure wether to fill up off the wagon now or wait and see how things pan out, it could be cheap come spring............or dear if it's a long winter.