Stubble to stubble rates

[Salopian_Will]

You might find your kit appreciating in value if you aren't putting hours on it!!

In hindsight, I should have said cost to change. Our kit has not depreciated but the cost to change is still eye watering.

 

[ajd132]

Quite a bit round here based on a tonne of wheat, neighbour rents his out and gets an actual tonne of wheat per acre to sell but must be out of tenants store by April.

Does that show trading risk for tax purposes?

 

[Farma Parma]

If it doesn’t work it could be incredibly financially damaging if you realise in year 2 of a five year fbt that wheat price has dropped dramatically and you are paying way over the odds!

i know such an outfit doing just that & there not the best at what there doing neither
Serves them right for just being greedy & paying silly rents

 

[Flat 10]

Or take a chance. And if it doesn't work so what. At least they had a go. Every time I've bought land it was " too dear". Even at £2k. Then when I sold it I "must be going bust". Farming has a sh!t attitude to success and trier's.

But don’t forget it’s taken a certain toll on you and you have now opted out. I obviously have very limited knowledge of your business, only what you have said on here and I admire what you achieved. However it can’t have been sustainable (however you define that) or you would have carried on? Or have I totally missed the point?

 

[Farma Parma]

Wheat @ £140 & bps at £90 = £600/AC
Wheat @ £170 & bps at £0 = £600/AC

What's today's price? What can you sell for for a year ahead? What's the basis for a reduction in rent again?

Wheat at £200 & bps at £65 = £800/AC so get that new RR ordered.

id put money on there being greater costs with that wheat at £170 & no BPS & like another has said very rarely is it decent yields & prices to match.
It just never happens.
2019 better than ave harvest yields but prices less
2020 much less than ave harvest prices much better to the fact of looking like a vast inc in income.
2021 is looking at this stage in better shape than it was 12months ago.
but i'll spend a little more on agchems & fert in a whole altho fert was cheaper per ton.
swings n roundabouts
i know one thing when i had a 4.8t crop of wheat back in 2015 i made next to nothing & all because of world prices where they were.

 

[A Trebor]

Does that show trading risk for tax purposes?

Not sure

 

[Salopian_Will]

Does that show trading risk for tax purposes?

Not sure

No it is a rent with an annual review mechanism.

 

[JCfarmer]

Wheat @ £140 & bps at £90 = £600/AC
Wheat @ £170 & bps at £0 = £600/AC

What's today's price? What can you sell for for a year ahead? What's the basis for a reduction in rent again?

Wheat at £200 & bps at £65 = £800/AC so get that new RR ordered.

Since when did you turn into a bloodly land agent tesla!?

 

[Cowcorn]

But don’t forget it’s taken a certain toll on you and you have now opted out. I obviously have very limited knowledge of your business, only what you have said on here and I admire what you achieved. However it can’t have been sustainable (however you define that) or you would have carried on? Or have I totally missed the point?

Sometimes its better to quit while the quittings good !!
We dropped out of the renting merry go round when the sfp allowed intitlement stacking . All through the eighties and ninties we were renting over 600 acres of ground . Fields from 7 to 90 acres spread out over a 25 mile radius from home
When rents were going one way and grain prices the other it was a no brainer .
Though it was a long time before we actually admitted to ourselves that we had become busy fools .
Giving up spuds to expand the Dairy was one of my better choices too .
Cows put money in your pocket every month ..
Unfortunately the maths dont lie and last week lakelands paid me 39 cent a litre for Aprils milk . Monthly supply was 75 000 litres ....
Much as i love arable farming the returns are not in it even if wheat is 200 a ton .
Im convinced the best thing for farmers would be an end to all schemes and subs
Then the market would have to pony up a decent price and landlords wouldnt have envelope options to use to pull tenants over the rack .

 

[ajd132]

Sometimes its better to quit while the quittings good !!
We dropped out of the renting merry go round when the sfp allowed intitlement stacking . All through the eighties and ninties we were renting over 600 acres of ground . Fields from 7 to 90 acres spread out over a 25 mile radius from home
When rents were going one way and grain prices the other it was a no brainer .
Though it was a long time before we actually admitted to ourselves that we had become busy fools .
Giving up spuds to expand the Dairy was one of my better choices too .
Cows put money in your pocket every month ..
Unfortunately the maths dont lie and last week lakelands paid me 39 cent a litre for Aprils milk . Monthly supply was 75 000 litres ....
Much as i love arable farming the returns are not in it even if wheat is 200 a ton .
Im convinced the best thing for farmers would be an end to all schemes and subs
Then the market would have to pony up a decent price and landlords wouldnt have envelope options to use to pull tenants over the rack .

Agree we should end all grants and subs but wheat at £200 leaves a very healthy profit.

 

[goodevans]

The bottom line is if you want to be a farmer you have to have a farm

 

[teslacoils]

But don’t forget it’s taken a certain toll on you and you have now opted out. I obviously have very limited knowledge of your business, only what you have said on here and I admire what you achieved. However it can’t have been sustainable (however you define that) or you would have carried on? Or have I totally missed the point?

Yup. Mainly mental toll. It was 15 years of shoving all the eggs in one basket. And quite a risky basket. But financially it was pretty decent. The tipping point is with every expanding business that there becomes certain pinch points. For me these were:

1) I'm not good with staff. Managing people is not a skill I have.
2) The balance between cold hard cash, and building assets. At certain points, you have to expand your kit before the land. This was combine for me. I wasn't willing to spend £350k on a combine early on in the bps / elms cycle when I only (on paper) had one year of my agreement left.
3) Paying staff double what you draw out as your investing in kit does not have much appeal to ones spouse - if you've ever told your Mrs that there's no holiday this year, while a also explaining the economics of a new tractor while trying to keep a straight face then you'll know what I mean. What my dad called "different money".
4) Mentally, it was pointed out that after doing my back again while shovelling out 50 year old bins full of barley was not going to end well. The panic attacks, nightmares, etc were pretty much signs that I was going to be in s hospital quite soon.

But, I essentially retired at 40 with my own little place ticking away. Raised two children and supported my wife's career. Drove some fun toys. Grew some big crops. Still do.

 

[goodevans]

Yup. Mainly mental toll. It was 15 years of shoving all the eggs in one basket. And quite a risky basket. But financially it was pretty decent. The tipping point is with every expanding business that there becomes certain pinch points. For me these were:

1) I'm not good with staff. Managing people is not a skill I have.
2) The balance between cold hard cash, and building assets. At certain points, you have to expand your kit before the land. This was combine for me. I wasn't willing to spend £350k on a combine early on in the bps / elms cycle when I only (on paper) had one year of my agreement left.
3) Paying staff double what you draw out as your investing in kit does not have much appeal to ones spouse - if you've ever told your Mrs that there's no holiday this year, while a also explaining the economics of a new tractor while trying to keep a straight face then you'll know what I mean. What my dad called "different money".
4) Mentally, it was pointed out that after doing my back again while shovelling out 50 year old bins full of barley was not going to end well. The panic attacks, nightmares, etc were pretty much signs that I was going to be in s hospital quite soon.

But, I essentially retired at 40 with my own little place ticking away. Raised two children and supported my wife's career. Drove some fun toys. Grew some big crops. Still do.

I like your dad's saying

 

[Cowcorn]

Agree we should end all grants and subs but wheat at £200 leaves a very healthy profit.

It does to be sure , but its buttons compared to the profit an acre under dairy grass leaves
I suppose the point im making is that 120 good cows can put more money into in your pocket than a thousand acres of wheat even if you are on reasonable rent .
The other side of the coin is that some Dairy guys are bidding up to 400 acre for land that allows expansion so the desire to give away all your profit is not confined to one sector !!! .
The sweet spot is the one to aim for no matter what size or enterprise you have .
After that the law of diminishing returns starts to bite ....

 

[teslacoils]

Since when did you turn into a bloodly land agent tesla!?

Sorry.

I recant a story when a block of land came up. This was one of the first times I'd seen the idea of testing p&k on entry to stop it being raped.

The agent very clearly stated that the LL gave precisely zero fukks about p&k and I could tender more and they'd cross that bit out.

There's a value to being the existing tenant. Even on an fbt. You're "in" so get first dibs.

But I take the point that you can time it badly and loose a lot. Certain years stick out as what I call a "buster". 2012 for one. We made a filthy fortune in 2011 and went the usual balls deep for 2012 with new osr seeder and all-sorts. Well, with half the farm failed osr or thereabout, and plenty of fallow it ended badly. Took two years to recover and I vowed never to rely on anything, and I cut costs to the absolute bone. But that really taught me how to dump cost and push cost per ton down by knowing the difference between cutting and spending. And never invested for longer that my remaining CFA term.

So even on my own farm, it's a constant experience pushing these fields. But if 3t/AC is what I was growing a) I'd not have farmed much land and b) I'd be selling up now.

Still, I'm now hemmed in by folk farming 3,4,5000 acres. So even at 2500ac it wasn't a huge outfit we ran. But really, they pay £12/hr to sweep up at the crisp factory - remember that when you're digging wet clay out of a machine at 3am. The family farm is going to be extinct in 50 years. It will be no more than a nice holiday home. My children have said they will keep it as a base in the UK while they live abroad and will let it out on air BnB. And I applaudevthem for that.

It's a hobby for me and I'm a highly educated, fit, 41yo. Looking for part time job in September.....it won't be in agriculture.

 

[teslacoils]

I like your dad's saying

God I don't. Had years growing up where every penny went into the farm. As a child it put me right off. Best intentions etc but really showed it up as you need to be able to draw a wage to keep up with society or you just end up burnt out, with kids you never see, and nothing to show but a field they sell when you cark it.

I put a real fbt rent, wage, and depreciation in everything now.

 

[benny6910]

Wheat @ £140 & bps at £90 = £600/AC
Wheat @ £170 & bps at £0 = £600/AC

What's today's price? What can you sell for for a year ahead? What's the basis for a reduction in rent again?

Wheat at £200 & bps at £65 = £800/AC so get that new RR ordered.

Not able to push to a new r r so this will have to do I suppose.

 

[Flat 10]

Yup. Mainly mental toll. It was 15 years of shoving all the eggs in one basket. And quite a risky basket. But financially it was pretty decent. The tipping point is with every expanding business that there becomes certain pinch points. For me these were:

1) I'm not good with staff. Managing people is not a skill I have.
2) The balance between cold hard cash, and building assets. At certain points, you have to expand your kit before the land. This was combine for me. I wasn't willing to spend £350k on a combine early on in the bps / elms cycle when I only (on paper) had one year of my agreement left.
3) Paying staff double what you draw out as your investing in kit does not have much appeal to ones spouse - if you've ever told your Mrs that there's no holiday this year, while a also explaining the economics of a new tractor while trying to keep a straight face then you'll know what I mean. What my dad called "different money".
4) Mentally, it was pointed out that after doing my back again while shovelling out 50 year old bins full of barley was not going to end well. The panic attacks, nightmares, etc were pretty much signs that I was going to be in s hospital quite soon.

But, I essentially retired at 40 with my own little place ticking away. Raised two children and supported my wife's career. Drove some fun toys. Grew some big crops. Still do.

I tip my hat to you. You have achieved a lot more than me and you aren’t much older. And I’ll probably still be muddling along in my 60s and have sod all to retire with.

 

[teslacoils]

I tip my hat to you. You have achieved a lot more than me and you aren’t much older. And I’ll probably still be muddling along in my 60s and have sod all to retire with.

It wasn't a solo effort. Despite the inevitable strife, my brother, father and I covered most of the bases for "things needed to make farm work". I was really a paper pusher.

Give me a few years and I'm sure I can whittle down my farming warchest to nothing. Seems to be the favoured way. Hopefully it will involve hot tubs full of babes.

With the "perspective" hat on, most fairly average civil servants, nurses, teachers etc will be retiring in their early 60s with a pension equivalent to a private pot of well over £1m. So got to think that's only what your average man on the street will have - plus any house etc they have bought. And they will have functioning lower back and knees in all likelihood.

If your making £100/AC proper profit then you need to rent 500ac just to be in a position to have a life like a middle manager at your local council.

A far cry from when 100ac tenanted farm would support the farmer, his stay at home wife, and three children. Everything is more efficient and there's no reason a farm shouldn't be. 1000ac a man is normal.

 

[Spud]

Not able to push to a new r r so this will have to do I suppose.

Have you a pic of you sat in said fancy mohtah Benny lad?