land rent

[tipsy]

Anyone go to,or have any info from the Kramer land rent auction at North Battleford? I hear the land went for 60.00 an acre. None of my business but, seems plenty high for an area that is far from a sure-crop area, in- fact have they not had some production problems over the last few years? Iam wondering if there was more than one bidder? Maybe he/they are looking for more!

[furrowtickler]

There were several bidders up to $55 .
Just look at the assesments, they tell the story. Fairly light land - sandy loam. Also prone to spring and fall frosts. Not a good time to expand here, way too much risk for that kind of money.

[seabass]

More than likely 4th or 5th generation farmers. Gotta keep the kids involved somehow.

[furrowtickler]

3rd I believe.

[SASKFARMER3]

Or is it BS corporate play farms that are using the rent to offset their production. Their accountants tell them go for it will work with CASIP etc. But in real terms their loosing their shirt 1st 2nd or 3rd their idiots.

[rough]

They may be idiots, but I bet they know how to use
the english language a lot better than this supposed
expert SF3.

[Hopperbin]

SF3 is not an idiot. According to CFIP if you farmed one quarter of land and the next year you farmed 20 quarters or should go by acres really but in English language your net income or your coverage increases 20 fold on your CFIP which is why some large farms are increasing in size, could be because of CASIP coverage.

[seabass]

Programs are great if your lucky but I've seen farms try that around here back in the GRIP days and they lasted a few years but are now extinct. Robbing Peter to pay Paul only lasts so long. I believe government programs have a way of overinflating local farming decisions with bad consequences.

[Hopperbin]

True we are likely headed into a year or years when CFIP payout is a percentage of what you are entitled. I don't like to admit to farming programs but the old caise did me well when I expanded. I do not agree entirely with the program even though it has paid well and even guaranteed the purchase of land in my books.

[SASKFARMER3]

Ruff if that's your criticism what a joke.

[furrowtickler]

No corperate farms involved, just a local family farm.

[SASKFARMER3]

Are they good at math or just want more and more and more. Hey that's coming from me. Once we hit 10,000 acres that's it. But want ownership instead of renting.

[SASKFARMER3]

Well all entries on this blog relating to farm programs need to be thought over again.

With CFIP thestructure change was based on a benchmark per unit (or per acre) margin adjustment for any acres increased or decreased. This was unfair to an exceptional farm as in most circumstances, the farms actual margin was higher than the BPU but a lottery to the below average one.

In Agristability, the windfalls will be reduced or eliminated. A new ratio method is what will be used to adjust for increases or decreases in farm size.

In other words, if your historical margin is strong, your structural change will be fair to you. On the flip side. if you have never made money in this game, the program will not be there adequately either.

But for those that are struggling in this farming game, there might be other issues that need to be addressed.

[bucket]

If they have that kind of money for rent - why are they not buying land?

If I had that kind of money and I was so smart as to know what to do with it I would not be renting land. There are better places to spend the equivalent of 9600 a quarter for the privilege of tractoring across a piece of land.

I might take up tiger woods approach. Either way you are getting screwed.

[furrowtickler]

Land in that area is hard to come buy for puchase. Oil wells dot the landscape. So the only way to farm more for most farmers is to rent it.
Also being a land rent auction, like most Kramer sales, premiums seem to be paid, they seem to be very good at extracting the most money possible from the buyer - or in this case the renter.
What is most concerning to the rest of us is the fallout from this auction. Land in our area is assessed much higher than the said property(2x). Dollar signs are going to buble up with every land owner - "my land is worth more than that guy's" So where is this going to lead - $70-80/ac? Hopefully it does not get to that point, like I said before not a good time to expand - take stock of what you already farm and maximise what you do already and wait for the fallout to subside.
Farmers tend to have very short memories, 2001,2002 drought reduced crops to nothing.