OT. FUTURE OF FARMING

Cash rent prices in my area are rediculous. How is a young person trying to start farming going to do it? The big guys are going around paying sky high rent prices just to get some more land, just to say they got another 80. When young people are using their education and figuring a fair price for themselves and the tenant, because they cannot afford that top dollar. Land owners or investors just see $$ signs and dont care. Dont get me wrong the big guys may do a good job, but some simply dont. Theres something wrong with this picture. young people who dream of having their own operation, but may not have to land behind them to start, will never be able to start.

do some math. I think they still teach that in school. Figure your inputs, Corn @ $6.50 will pay more rent than $3 corn did. Use older smaller equipment and do your own labor and repairs. Hire a combine if you don't have enough acres to justify your own yet. The little guy can stand it just as long as the big boys. I ain't worried. If the big guy don't make money he will quit. His banker will force him to.

There are those people who have more money than they know what to do with, & know how to talk other people out of theirs as well. But its not just farming. I read a sad story on MSNBC just about an hour ago about an elderly couples rent going from $700 / mo. to $2000 / mo. in North Dakota due to the oil boom. They are in their 80's, & are forced to move because there's no way they can pay that kind of rent on Social Security. Oil boom or not; how in the US does this happen. Why are they not building more apartments, & or homes there! Looks like they have a housing crisis; but not anything like what most of the country is facing!

Its sad; thats true. & what would happen if Goverment Subsidies were eliminated. I bet You land prices would fall to a more realistic level, & put everyone on the same playing field!!! Private investors would be crying the blues; but how much tax money did the Govt tax (aka: rob) from the that ND couple to give to 5000 acre farms with millions in assets. I farm, & hate the subsidie program with a passion! It has ruined real genuine family farming by corporations pushing people out for that Govt money!!!

Have a guy coming in here from out of state and buying up pasture and brushy pasture, clearing it, and going to tear it up and farm it. Everyone is say this guy has won the lottery or is taking someone down with him when he goes. Operates like its easy to make a buck.

So? Just because somebody has a "dream" doesn't mean that society has to provide it. Farming is a capital intensive business. I don't know of anyone who has started around here in 20 years or more. The big farms have just gotten larger, and some of the smaller guys have gone to work for the bigger farms or have gone into seed sales or other ag related work. Or are just sitting, collecting rent. Really, at one time folks were starting auto companies. It's pretty hard now, simply because of the $$$ required. Farming really has been a case of "marry it or inherit it" for quite awhile. I think that now that input costs are a couple hundred per acre, it's cleared out a lot of part time guys.

(quoted from post at 05:32:43 11/15/11) So? Just because somebody has a "dream" doesn't mean that society has to provide it. .

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Don't be so hard on the guy....I remember someone else havin a dream and society's been providin it ever since.........

You have to play the fiddler if you want to dance. Me I now farm what the family owns and have found other ways to be paid for my time, way less stressful and risky.

Cowman, you talk like the price of corn has doubled but the price of everything else has stayed the same.

Fuel prices have more than doubled. Seed prices, fertilizer prices, replacement parts prices... all way up, AT LEAST doubled in recent years. Tire prices are out of this world.

At the end of the season, after all the bills are paid, what you've got left over isn't any more than it ever has been... Then you find out the cost of living has gone up!

As for the banker making the big ones quit if they're not making money... They're "too big to fail" and the banker just keeps giving them more and more money. I see it all the time around here. Farmers getting millions from the bank to build a giant new barn, or buy all new equipment, and doing it all over again in a year or two. They can't possibly be paying off those loans, or ever hope to pay them off...

It's a very complicated issue when you think about it. I tend to agree with those that say it is not up to government to set a dream in motion but there are exceptions. It's not only about the young but those who are under financed. It seems farming is about who has big money. They are going to be the players going into the future. And you are right that nearly all the big money people are not making overly rational decisions when it comes to rental and land prices. Before anybody yells sour grapes I fail to see the business sense in paying in excess of 4000 dollars per acre on ground that can only be used for pasture or lesser hay crops based on the soil profile. I am going out on a limb and will note there are more and more big cash operators coming in that use illicit money (drug money) to finance their business.
I would agree with those that say you just have to deal with what life hands you even if it is something you did not want. I really do not see a financially responsible way to hand everybody the dream of their choice via government money. However, we should note by the recent demonstrations against Wall Street that there are many people that are more than simmering over their lot in life. Bad things happen when you have a large group of people that are angry with a lot of time on their hands. We may be getting to a point where we may have to stop approaching this problem as business as usual.

True! Remembering praticing the WEDGE drill in April '68 in Alabama.

Here is how it is in my area, I am a small farmer (200 acres my own, 300 more custom work). If the large farmers can make $5.00 or more an acre they will farm it, they already got the huge machinery, semis, manpower. If I want to rent 80 acres and can only make $5 I won't do it, to much to risk for me. On the brighter side I am starting to see the big farmers not want to mess around with renting 10-20 acres or not buying 40 acres unless it is close to another farm they have, so there is where my opportunity lies, I have to pursue these small parcels, generally they will be less rent to run. In my area a lot of these large farmers are 60 + years old, so a lot of things can change in the next 10 years, hopefully in my favor as I would like to find some more ground and quit my town job.

Save your money,hone up on your farming skills and be ready to buy land at the next commodity crash.The big boys are always the first to go belly up.

well let me play devils advocate here just a little. You want to pay little for the land rent,so called big guy pays more. IF it were your land,who would you rent to? Honestly now ,ive been there myself on both sides of the fence ,but if you were honest i bet you wouldnt even consider the lesser offer. The old saying money talks and bs walk is as true here as anywhere else. Now that being said I understand your problem ,like i say been there my own self. Farming is no longer a substenence buisness,when i was growing up we farmed to have groceries first and to make money second. For the first time in a long time real money can be made (and lost) in the farming/cattle buisness. You seem to forget that those so called "big guys" have a dream also. And i can assure you they've been there through the good and the bad times. It does cost money to get started, DEFINITLY, but let me tell you a little secret ,IT ALWAYS HAS!!!
Let me give you an example, from my own experience. I bought my first farm for honestly $25 a acre,sounds good doesnt it? But you know what? I was making less than a dollar an hour,had a wife and two kids.rent,bills,broken down old cars,all the normal things folks starting out have.I drug a locked up a model jd tractor out of a neighbors cow lot where it had set till the front wheels rusted away,( in fact one of those wheels exploded when i tried to air up the tire and broke my arm) just plain dumb luck it wasnt my head,and i never went to dr cause i couldnt afford to. Has hurt ever since. I tore that old jd down with my 16 year old wife holding a lantern and got it running after working a job 12 hrs a day. Couldnt afford parts so I simply got it unstuck,took a piece of sandpaper and cleaned what rust i could out of cyls,put it back together with the old gaskets and farmed with it for several years. No you dont have to explain to me how hard it is to get started. Been there done it. I'm certainly not rich now,and dont fgure I will live long enough to get there.
Every thing in this buisness is relative,it seems as if you make a dollar it costs you $0.90 to make it. But for the first time in a long time folks who have hung with it,MIGHT make some real money. I dont begrudge them for that, not in the least. More power to them I say. they deserve every nickle. Sort of funny though,those guys who have weathered the storms ,dry, cold,wet, disease,insects , and a thousand other things,to quite honestly feed folks in this country are the bad guys now. Throuh hard work ,these families who have worked for the american public ,for very often generations are the bad guys. I say B$!!!direct pay farm subsidies are no more. Even though folks here still whining about them. Guess what ,thats going to hurt you more than it would ever help.
Theres a reason bankers loan these folks money,Its a simple thing called financial stability. They pay their bills,on time ,every time,without fail,and there is no doubt they will pay the next round. They have the FINACIAL SECURITY to do it! Young folks today just see wealth,everything to them is, what do they call it, "Bling", and thats all they seem to want. In fact ,thats what has this country in the shape it is in now. Young folks ( and americans in general) wanted wealth. But they missed the one important lesson in economics 101. The one about financial security. They built for themselves a society built on credit. As long as the credit card payment was paid they could live like rock stars.only problem with that is your one payment away from ruin constanly. Its pretty evident here some folks still believe in that system. But let me give you a piece of advice, one farmer to another. You will NEVER have wealth without financial security,its impossible.
But theres another little story that goes with This. Somewhere down the line that so called big farmer started out just exactly like you. He and their families built those farms and ranches with sweat,and suffering just like you will if you succeed. Some where,someplace there was that old guy who stared at the back end of a mule day after day,rode fence in a blizzard or carried a choking calf in out of a dust storm. Their kids took turns pumping the pump handle when the wind didnt blow,day after day,to water the stock,and they caried water in pails to a drying up garden so they could eat another winter. Guess what, youll do the same if you make it,maybe not in the same way,but youll do it. Yes it does cost a lot nowdays thats a plain and simple fact. But if your not willing to pay the price, either in sweat or money your better off not starting. If you cant afford to pay the price, you simply need to work more on your finances. If you cant afford to buy or rent the land now how can you put in a crop? how can you survive if that crop fails? honestly, for your own good ,you need to work on your backup,you need to put on your life jacket before you jump in the white water. Its tough, sure enough,going to get worse i'm afraid. But if you are going to have a chance of making it,youve got to be able to swim.If that means you have to wait until a cars paid for or something,well so be it. You dont lose a dream by waiting,you can always work towards a dream. You lose a dream by failing. if you start out setup to fail,you didnt lose a dream you threw it away and abandoned it.

A lot of wisdom in what you are saying. However, don't confuse the next crash with what happened in the 1980's. Plenty of the BTO's are very secure financially. I don't see a huge fall back in land prices unlike the 1980's but we may well see fallbacks in the area of 35 percent or greater. I think the big thing will be there will be opportunities out there that the BTO's can not possibly stave all his smaller competition off.
What you have stated is basically my plan for the next decade and change. It would be very reckless on my part to severely overpay for very mediocre land. Also, on my finances 50,000 dollars does not go far based on today's values. Somedays it is very hard to look at the long view when I hear some BTO is getting ready to devour a piece of ground near me but it is the only realistic option for me.

EXACTLY!!!!!!!!! So many folks (and they're not always young) wanna cry, "Life's not fair/I want it, I deserve it, boo hoo hoo". I've worked for 30 cents an hour..........manual/hard work.......and was glad to get it.

Not true.....at least around 'here'; lots of local farmers went belly-up when we had a peanut farmer at the helm and they were all the marginal ones; don't know of a single big farmer that quit.

It would be very hard for some one to start out farming with no land and no equipment these days. especially the way the banks are so hesitant to loan any money these days. Not only the price of land is high but all your inputs are high as well. Fuel,chemical,seed,fertilizer,rent,repairs even doing them yourself the parts are pricey. It can be done but a guy starting from nothing has a rough road to get started. There are still some old time landowners who like to share crop still. Those are the landlords to find for a guy startin out or you find the ground that a bigger farmer doesnt want because they cant get there equipment in the field.

Jack, there is so much truth about what you are saying and sometimes it is just a matter of perspective. Now let me say not every big operator is some honorable guy who has paid his dues. I know more than a couple of situations where people are going backwards because they are competing against dirtbag operators that have one or both feet outside the law. Pretty hard to sit still and take it when a guy is watching those guys eat your lunch. Also, envy will be one of the things that will bring our society down but that message is falling on deaf ears everywhere so people need to start thinking that at some point this is going to come to a nasty head if we stay on the same course.

I started by buying small tracts where I could and when I could afford it, lucked out in my first few years with really good stands of alfalfa selling seed at the right time paid for every piece of land I bought, rented pastures and decent cattle prices allowed me to triple my herd. reinvested every penny back into the farming operation and kept track of every dime. worked on a drilling rig when I wasn"t on the farm, got tired of being laid off in the oilfield and went to school. bought a 1070 case at an estate auction and had to work on that wore out piece of junk almost on a daily basis, but it was paid for. feed truck was a state auction reject-junky old dodge. some of my smaller tracts I moved old houses bought from the hospital when they expanded, set up 10 acre tracts with house and fence and sold for a profit. never taking a dime and reinvesting. fast forward ten years--roughly 600 acres tillable land and 400 acres pasture. managed well I luckily didn"t lose my shirt from the drought. I sell hunts, hire a few fellows to help when I need them. borrow equipment from my neighbors and loan mine when they need it. and I still have a full time job. it can be done-but most don"t have the grit or drive to do it the right way.

I agree 100% with you and in fact just started to post this same thing.10- 20 acres are not what they are looking for. Not that its not profitable,its just that it costs too much to move machinery onto a place this small. These places are what to look for if your starting. They are the ones folks are desperate to get rid of. builders ,who for years bought any available peice of land is pretty well out of the picture. MY ADVICE,and i'm honestly serious here, go to the bank, every bank close to you. Sit down with the pres ,wait if you have too,thats part of it. Let him know what your looking for ,in what area. guess what,banks arent in the real estate buisness they are in the money buisness. If they sell to you,with less loss,they are all for it in most cases. If you honestly want to become one of those so called "big boys",nows the time in my opinion.Buy what you can HONESTLY afford,make it PAY,let it buy the next place. Do EXACTLY what you see the big guys doing. Simply adjust the scale to your TRUE budget.

As a young farmer, it definitely is hard, and to get started you need to take a very different, risk-prone, capital-intensive path to get your business off the ground. Banks are very resistant to lend, limiting your options to paying cash (which you probably don't have) or borrowing from JD, Case, etc -- and you need good credit for that.

I'm 28 and started when I was 24 with no background in farming. I don't grow row crops, just hay / oats, but in my limited experience, getting going is tough no matter what you do. Wife and I both have good full-time jobs; we also run a horse boarding facility out of our farm that is profitable. Without the boarding + jobs, the farm wouldn't work.

Fortunately I made enough money to pay outright for most of my equipment except for the larger pieces. If I was just farming without an outside job it would not work. But we have a lot of machinery debt ($100K or so in 4 years) that will be all paid for in about 3 years time - it is something I look forward to.

So, let me be clear - if you are a new farmer without equipment or land, you need a very good job and be willing to take heavy risks to make a go at it. You just can't farm with a $10-20K budget, you won't make it.

Not to mention it is a costly lesson to buy machinery that isn't suited to your job -- but more to your budget -- only to have to replace it 1-3 years later and lose money on the trade. I've been through three different tractors in four years until I settled on the right one, all because I didn't want to spend the money up front to get what I needed. I've lost about $15K in those trades... money I'll never get back.

There is hope, but unless you marry into farming or were raised with land, it is very difficult to start, stay, and make money. There is no proven formula for how one gets into farming, but there are many, many lessons to be learned from those that failed trying.

Start with a good in-town job and don't think about quitting until you can afford it.

I've seen the term "fair" being used by many to justify certain situations; ie, wealthy aren't paying their fair share of taxes, although they already pay a significant majority. What is fair, whom determines what is fair? Seems fair is frequently used by those which are trying to extract more money from whomever, whether it be a union or by some factions to increase taxes. Would agree many corporations and wealthy individuals are greedy but it is a very slippery slope when start using the word "fair" which is largely a personal interpretation. Personally I'm comfortable, but a "far cry" from wealthy. Is land rent fair when you make enough per acre that it doesn't require many acres to survive? Bottom line is that my interpretation of a fair land rent should be what the local market is willing to offer.

heres something to think about,we all want to buy that 1000 acre parcel of land but lets look at it honestly.
first, the profit margin on one acre is just the same PER ACRE as 100,000 acres. If you can make one pay,it stands to reason with the right equipment you could make 100,000 pay. Its all just a matter of scale.
second ,let me lay out a scenario for you. Lets say your just starting out. What if you owned a ten acre plot of land where you live,and 100 acres comes up for sale next door to you on one side,and 10 acres on the other. Which would be the wiser investment? Say you bought the ten acres on a five or three year note,and are able to make payments. When you make that last payment you've made your buisness 100% increase in 3-5 years.Can gm do this? ford,dodge any of the traded stocks? how many ceo's can claim that?Ive taken something I can afford( remember being able to afford something means you can pay for it in good times and bad)and made it work. But lets say i bought the 100 acres and its more than you really could afford. The only way you can possibly make it pay is for it to pay for itself. You've risked your entire lively hood on a buisness that is risky at best and you have nothing to fall back on. But lets say you make it pay and you make that payment. You've invested your whole working capital into it. Its taken every thing you have or can borrow to put in a crop and get it to market. Which is the better buisness decision? which scenario could you walk into the bank lay your books out in front of a loan officer and be in a better position to buy the next place? what that banker is going to look for is not how many acres you have ,hes not in the real etate buisness. What he wants to see is a guaranteed gain,not a chance encounter with luck ,and not a place he has to finance the crop on. You may have spent more, you may have gained more but who is better positioned for growth,that will make not only you but the bank money?the one thats secure of course,not the fellow asking for operating funds. Hes land poor. If you bought the ten acres,your in a much better position finacially to walk in and say i want to expand more . This is how those big boys do,just like this,they play in a different league than you but they have far and away more time to get there. Its simply a matter of degrees,where you and i spend a 100 they spend 10,000. But they've had several generations of guys doing it. no reason that you cant do the same,its all just a matter of starting and doing it right.

Jack,
Here's the problem with your devils advocate, if you made $1 an hour you could buy 1 acre every 25 hours, good farmland is bringing $8000 an acre. I consider a good wage for someone that is young and went to college around 25 an hour. In today terms you would have to work 320 hours to buy the same acre. Money wise times are much harder today.
Nate

I`m going to have to disagree just a bit, I don`t think a good day job is needed, and in many cases can be a hindrance to a small guy starting out. I`m just starting out myself, and this last summer was a bad one for hay up here. My dad and I did better than most up here because we had the time to put into the ground, and we were ready to cut when an opportunity arose, we were tedding hay at 10AM instead of some others at 5:30PM when they get off work, and we got more hay up than the folks with bigger, better equipment and day jobs. I don`t need much to live on, I live simply and expect to continue to do so for some time. I got lucky and get to start out with better equipment than I might have, but all but 5 acres I`m working belongs to someone else, some is being share-cropped, some I am allowed to take for now for opening up neglected fields (with a brush-hog and a chainsaw), and they are all small pieces the local BTO did not want because they are not worth his time. I could not have opened up the old fields I did if I was working full time, and I do not have the newest equipment, and could be doing the same thing with even older equipment, but not if I had to devote 10 hours a day to someone else.

I`m 26 and just getting started, and I think there is hope for farming. Anyone who is willing to put in way to much work to barely scratch out a living, and make just enought to turn over a few more acres next year, find old worn out equipment and spend the winter fixing it up (I`m putting my $200 JD 430 back together, I think I will get more bang for my buck than taking out a loan for a bigger, newer tractor), might just make it. I have no debt at this point, I hope to keep it that way as long as possible, and any debt will be for land, and land only.

Josh

The same thing is happening in western MN. The day will soon come when there will be 2 types of farming operations; the big operators with 1000's of acres and the "hobby" farmer, (those that farm the home place during the evenings and weekends and have full time jobs somewhere else). I think the only way to get into farming now is to be born into it, start farming with mom & Dad, or uncle ect. , marry into it, and as memtioned before, find small parcels to farm. There may be employment opportunities with the big operators too.

Josh........not picking on you or shooting you down, but.............it might be interesting to know what your living arrangements are: got a wife (working or not?); got kids; making a house payment; paying house rent; paying for a vehicle(s); got any debt from school; buying your food, clothing, insurance, telephone, internet connection, entertainment expenses, etc out of the profit from your hay operation?? Not still putting your feet under your dad's table?

Cowman you're right on the mark. The big farmers have to sit across from the banker too. They can only shuffle money around to cover their losses for so long. Look at what happened to the big banks? Jim

True of course but money is much easier to come by now,its all sort of relative. Saw a good 160 acre bottom land farm planted all in alfalfa sell for $180,000 a three or four months ago, so bargains are out there. I'm not trying to discourage him in any way. Its simply that farming is changing,very fast. So many new rules and regulations that even the folks who put them into effect have trouble explaining them. my point is this, if your just starting out in farming today,work from a position of security. It seems like farmers these days are on the top of the hit list right behind the terrorists and bp,you better not stick your neck out too far.I know how much land sells for and i know how much it rents for,but its hard to fault a guy whos paying that $8000 an acre for renting his land to the highest bidder also, if you see what i mean.That 8000 an acre is exactly why i suggest talking to the bankers and the loan companies,they know whos going to default and you can often step in,make a real deal and help out everyone involved. Nows the time to buy, if you can,its not the time to go far into debt for sure. Its probably not the best time to start farming,but things dont seem to be looking better for the future either.when you start paying the farm inputs nowdays and try to make a living ,you better have you ducks in a row, I'm getting out myself too old and too tired.I can feed a few old cows and work far less.

(quoted from post at 13:55:05 11/15/11) Josh........not picking on you or shooting you down, but.............it might be interesting to know what your living arrangements are: got a wife (working or not?); got kids; making a house payment; paying house rent; paying for a vehicle(s); got any debt from school; buying your food, clothing, insurance, telephone, internet connection, entertainment expenses, etc out of the profit from your hay operation?? Not still putting your feet under your dad's table?

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Not a problem, all fair questions. Yes, I live with my dad. Not because I have not lived on my own, but because my mother died unexpectedly, so I moved home to help out my dad. I have a girlfriend, she works 3 jobs of her own accord, no kids because we know it would not work very well right now and are not ready to get married. No house payment, I do help with groceries, pay for my own trucks (all of which are used on the farm, no need for a commuter, and are all old and payed for) and insurance. When I lived on my own I paid for my own phone, had no computer (used the library) and my entertainment usually consists of a walk in the woods, so pretty cheap.

You are right in that I would be doing this differently if I was not in a partnership with my dad. I would be using older, smaller equipment most of which I already own, would need a rake and baler, both of which I know where to get older ones cheap, I already own a smaller tractor, tillage and seeding tools, and a mower. And I would be most likely haying one more season before opening up the 62 leased acres I am working on, and it would take a lot more time to open the ground with a 430 vs. a 4020. But I have run the numbers, and I could still make it work on my own, and will if I have to. The determination is there, and I would be stupid not to take advantage of a good thing with my dad, but I would make it work one way or another.

(quoted from post at 03:56:57 11/15/11) Cash rent prices in my area are rediculous. How is a young person trying to start farming going to do it? The big guys are going around paying sky high rent prices just to get some more land, just to say they got another 80. When young people are using their education and figuring a fair price for themselves and the tenant, because they cannot afford that top dollar. Land owners or investors just see $$ signs and dont care. Dont get me wrong the big guys may do a good job, but some simply dont. Theres something wrong with this picture. young people who dream of having their own operation, but may not have to land behind them to start, will never be able to start.

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It is almost impossible for a young person to start a farm without having one handed to them! We have been trying for years. After equipment ,then have to get the land . I have a sucsessfull construction company and have attempted for years. When you go to the land auctions or try to talk to someone about it they shun you. Im 34 now ,And we are gonna make one last run at it because I am lucky enough to have two Sons. The whole process has cost me alot but its my Damn dream.

Thanks for letting me say that

Larry O

Probably one of the big differences this time is that a lot of the big boys are not the ones owing the money on the land. A big part of their operations today is rent. If it crashes, they walk away... Then they come to terms with Deere for all of the leased gear they have that Deere has no other home for... and on it goes. The one that will lose here is the guy in debt to his ears with the bank and not enough cash to make the payment.

Rod

I would say most college grads around here would be making approximately 30K per year which approximates to 15 dollars per hour. It would take an advanced degree in a field of great demand (no English lit.) to get the 25 dollars an hour or greater wage. For a crop enterprise you are talking about maybe owning a small homestead (under 50 acres) and renting the rest. Easier said than done in current times where everybody and their brother are willing to pay steep rent on very maginally productive ground. The economics of today do not favor the farmer of modest financial means.

ALL capital intensive equipment businesses are like that.
I would like to start my own machine shop, but....Machinery costs REAL money, a building costs money too....Renting of course at first. It would take $100k to get started. But....my parents arent going to help me, cause they dont have $100k. Competition is fierce, government regulations, etc. ALL businesses are tough to start. Now...If you were to inherit a farm that would be nice huh?

Bumper sticker I bought my younger brother (started on his own - nothing given to him now owns some, rents a lot).


"Behind every successful farmer is a wife that works in town".


His wife has it on her Explorer.

I agree 100%. None of my friends are making $25 an hour either, thats why I said things are all different than they were when Jack started out. No matter how hard you work, starting from scratch in ag today is almost impossible without putting a great deal at risk. I'm 32 and find it hard to believe in ten years I'll have more ground than I currently do, 22 acres, tillable but in pasture. If my wife lost her job today, we would be on the street in a year, I bought more farm than I could afford but its a good thing I did with the way farmland values are going. Lately the price of land goes up faster than you can save money for it.
All but one of the other young farmers I know have family in it. The one that doesn't had both parents die of cancer within a year of each other he was 25 ish, not the best way to aquire ground in my opinion. I have a wife and three small kids, I'm not willing to take food out of their mouth so I can be a big farmer for a year only to lose it all when corn drops to $4 bu.
Nate

I don't rent anyland but the neighbour is renting several hundred acres for 15-30 an acre. 100 miles south rent is 300+ an acre. Yields are likely 30%-50% better which does help pay for that stupid rent price. Competition just doesn't really exist where I am, but even with competition, you can only go so high before higher rent prices just wouldn't make sense.

The future of farming will be ALL or NOTHING. Look at the changes in the last twenty years. There is no starting on your own today, not on row crop farming. The part of the country where I live there are already farmers farming 9 to 16 THOUSAND acers. Equipment companies, John Deere Case IH, keep coming out with bigger equipment each year and farmers have to have it. The only thing is that the Good Lord don't make anymore ground today so the larger operator finds a way to rent it out from the smaller farmer and that is what the equipment companies want today. They don't want ten different farmers farming a thousand acers each because maybe 5 out of thoes 10 might be running a different color so they want to get all consolidated into one and have control. Five years ago we were putting 2800 acres and today we are down to 2000. The man farming 12,000 acers started paying $225.00 a acre and we can't do it. Like I said it will be all or nothing.

I started my own farming business right out of college but in a area on the edge of suburbia with low quality land so rent is cheap and competition low. I also got into the farming buiness and no sights on the land ownership business which helps and have a farm that I could start to work out of with low rent and had other jobs to allow me to make money to get started. But if you are in a good area with large farmers you are not gonna compete with goverment subsidized corn growers. The corn programs of the 90s and stupid CRP programs almost killed me back then because I could not get any land. Stupid investors who where not farmers at all where getting $70 per acre to let land sit and 092 corn growers were getting paid market value for expected corn yields on land that sat idle -- stupid and unfair.

I agree with this statement. As a 35 year old who is trying to get into farming I see it plain and simple as the ability to get equity in order to purchase the capital items needed to turn a cashflow on 15% or less return on investment. This is the same problem any business has and from what I hear the only difference at times in the past were that some era"s made more return and some era"s had less capital necessary to get the work done.
I do think that the hardest part of getting into farming is acquiring land to work and that CRP has done more to keep young farmers out than anything else this century.

The big operator is reacting to commodity markets rising dramatically in the last 2 years. That is an attractive opportunity for profit in today's ag economy. No crime in that. Just free enterprise system at work. Everyone wants in on that potential profit. Big and small operator alike have same chance to capture market peaks & profit from them. Just have to keep control of costs, perhaps by renting instead of buying land & leasing instead of purchasing equip. Don't think big operators are the boogey man we portray them to be, they may be willing to assume more risk and may have accumulated more capital or have access to more capital. May have a sharp pencil. Ever calculate gross revenues on 6.75 corn vs 3.75 corn. Room for some healthy cash rents there. There is a place for everyone with a dream just may not be that right time yet for yours.Takes perserverance to get going and stay in ag.(And possibly a side job in town to subsidize a start up)

Lot of folks I know just want to crop farm or be a cattleman and I have no clue how one would go about doing that right out of the gate. I have been pretty lucky I guess.Most of the time if I'm not working on my own stuff I know someone that wants me to do something for them. I kinda like it that way I get to visit with them and I get to see how other people run their farms. We only own about 50 acres and it makes a nice base to keep stuff and can rent the rest for now while we save for when the land around us comes up for sale.Other than the cattle and hay I haul livestock,build fence and barns,skid loader work,do some vet work and welding for the amish,trade a little bit of equipment.Just whatever I guess,but most of it has to do with agriculture and that makes me happy.Also my wife has an ok job that provides insurance that and the fact we try to keep our debt low helps(cause it seems a whole lot more fun to work when the moneys not all spent by the time you get the check)

I'd make sure you have some customers first. I have a couple of friends that have very nice shops, very little work right now. One guy just told me that he put an addition on his house earlier this year. He had 100K in orders in front of him. Now he has zero. Doesn't know when he is getting any more work. I think manufacturing is tougher than farming. There always is some market for corn or beans. Machinists may have no market for their skills.

I think one thing that hasn't been mentioned is that folks used to be able to get a job that paid enough to buy some land or get started in a biz. Jobs now don't pay as much - or the pay hasn't gone up in years. People don't have the income to hobby farm anymore.

I think you have a bad attitude, look at what you wrote: "cash prices are rediculous" says who ? "how is a young person trying to start farming going to do it" I don't know, your dream, you tell us. "young people......figuring a fair price for themselfs and the tennant" neither you nor any other young person, needs to figure a fair price for the rest of us, supply and demand will do that on it own. But thanks for offering. "investors and landowners see $$ signs and don't care" what is wrong with that ? Most that want to farm will not, that is life. Talk to the bank and landowners about your dreams if you want to, feel free to have a bad attitude when doing it. Let us know how it works out.

theres a problem there also of course,first of all define a "living wage".Ive never had that question answered.I even asked those occupy folks and couldnt get an answer,but maybe you have it. Is the mythical living wage $15,$25,$35,$50, or more an hour? No one seems to be able to put a dollar figure on it. The problem is not the wages,and never has been. The problem is folks always seem to want more than they can afford. I've been as guilty as anyone dont get me wrong. Its very easy to blame our personal problems on out side sources,But i think if we wre really honest we would find 99% of the problems we encounter is of our own doing. Its hard to blame the crp program,conservation easment program,big farmers wanting to cash in on prices higher than they've ever been, when all you and I want is to cash in also. If a landowner feels these programs are best for him how is that wrong? Theres most often a reason for putting land in these programs. Take crp for instance,Ive done that myself. To qualify i had to farm (or try to farm) that piece of ground for x number of years before hand. I had to take that land out of production and plant it to grass ,THAT IS ALSO A CROP wheather you believe it or not. Lets go with your figure of $70 per acre that crp pays. First let me ask you this , can you make money farming ground these days that grows crops worth less than $70 and acre? I dont think so,Ive often seen folks spend $200 and acre putting crops in the ground. And your going to try to make a living off it? Most of the time this is marginal land that neither you or I could profitably farm any way. Its land best suited to grass. Heres a tip for you, if your first starting out,and find a piece of land for sale coming out of crp. Before you lay down your hard earned cash thinking you can farm it,you better look it over very carefully. Even if its right in the middle of the best farm land around. Chances are you will have a hard time making money off it. Theres a batter chance with eight or nine dollar wheat, than there is at four dollar,but your inputs are Far higher also. Of course there are those places where a farmer decided to retire and put his land in crp,but even the dumbest farmer can see the economic value of renting it out for 300 compared to 70 crp pays and he STILL has to take care of the crp land.
What about Conservation easements that those big movie folks like so well. Heres the deal there,once they are in the progrm its permanent. You may as well sit and cry because lincoln was shot for all the good it will do. Drive by it and enjoy the scenery once in a while. It will never be farmed again. Is that right or wrong? depends again on your point of veiw. On the one hand they bought the land and they can do what they please with it. And on the other if you would have had the money you could have bought it.
Maybe i look at this wrong,maybe the old ideas of sacrifice and hard work to get what you want dont really apply any more. But I see the problem of land acqusition as being not the lack of money ,but the fact that theres too many people with money. Even if someone gave each and every aspiring farmer 5 million dollars to buy land ,they still couldnt all buy it, theres simply not enough. Land prices would soar (as we see now) but thats not a symptom of greed ,its a problem of too many people with too MUCH money. Thats why i say go to the source,the banks ,the loan companies,try to find out if you can who is struggling and try to buy their place before it gets sold at a public auction. Try to beat your competition to it. Most bankers and things wont give you any names,but they can pass along the fact that your positioned to buy. A family thats fixing to lose their place anyway would most likely rather have you step in and take up that note instead of being forclosed on. Is that greed? todays attitude probably would say yes,that the proper thing would be to step in give them enough so they dont default. But in my opinion if i take up that note ,it allows them to start over ,helps everyone involved. They MIGHT learn their limits and make a better choice for themselves next time, and everyone wins. I f thats greed then maybe thats why i dont understand ,its simply that i'm the guy everyone is hollering about and dont know it!

heres another tip for you folks starting out,do a search on the net for school land leases in your area.I know the ones in okla are coming up soon ( or were just held recently). Most folks dont remember that land was set aside for schools and things and much of this is still leased out every few years by the states. Might be something there you can work into your plans. Like every thing else nowdays some restrictions apply, but you may find an opportunity there to help get started. Ive known some that has.

I think the future of farming will be done in by govt regulation.

Pesticides and big fuel tanks and massive fertilizer piles require regulation, I get that, but the nickel & dime regulation of engines, dust, smells, family labor, and so forth is going to doom the mid sized farmer.

Can't get a replacement engine block for an old tractor, well can't afford the $200,000 plastic & computer tractor that is allowed, and really nothing to replace it with, can't find a combine that fits 6 rows easily, will be all 12 row in another 10 years....

Farming in the USA is going the way of farming in USSR of a few decades ago - hired labor, huge farms, you quit when your shift is up never mind if a rain is coming, production is by the numbers, not by what works for that 10 acres. Regulated & controlled by EPA and OSHA. Might be coop or industry run, not govt run like USSR was, but ends up about the same - bread lines for the city dwellers.

Kind of a doom & gloom message, hope I'm wrong.

--->Paul

I would hope the bankers would not pass out names that are in financial distress. But I know it happens quite a bit and know there are a couple of farmers who had "inside" information as to who was in trouble thus weakening the distressed farmer's position in selling. I don't mind somebody getting big through being a better business person but I have heard of too many getting ahead by being a dirtbag lowlife.

yes its against the law for a banker to give out names and things,but its not against the law for him to mention to the guy in trouble such and such a guy is looking to BUY a place.My knowing your in trouble doesnt hurt you in any way. If your place is going up for auction for some reason why would it hurt you for me to know? I guess it may if i were supplying you seeds ,fuel, or something on credit. But the first time you didnt pay the bill would be a pretty good indication also!LOL

You are wrong about wages. Wages have been falling for years. Not my opinion, simply a fact.

The best way to "farm" is to make your $$ elsewhere first, somehow work "off-farm" for a while and save up some cash. There is nothing wrong with hobby farming--it takes the stress out of it.

1) If you have a GOAL and work towards it, good things will happen. A DREAM is just that--a goal takes preparation.

2) Get an education, LOTS of it. Bachelor's is a must if you want to improve your odds, Master's is even better.. Don't tell me you can't--you just don't want it enough.

3)"working for the other guy" never made anyone rich. Do it for a few years if you have to, but then start a business of your own. RISK = REWARD. But you must have a well-orchestrated plan, not a dream. Don't watch tv, go to business seminars or read a book.

4) working for yourself, being self-employed, is just a 24-hr-a day job. Run a business with employees doing the daily work and you setting at the desk brainstorming, working on the future, ect. Doing the day-to-day menial stuff (other than when first starting out) limits your ability to grow. Business can be successful beyond your wildest dreams!!

5) Business profits = farm ownership, if you so desire. Trying to scratch out a living just from the land w/o some "help" is probably not the best course of action these days.

6) Land prices are always too high (at the time of purchase). Always have been, always will be.

7) Cash is king!! Bargains come along for those with a quick analytical mind and available cash.

8) The future starts with your attitude. If you think you are beat, then you're right!