One Earth Farms!

[SASKFARMER3]

Their efficiencies and overhead will kill them. Their is no way there more efficient than av farmer.

[ColevilleH2S]

If you don't believe my statement that their size will kill them. Let history be your teacher. Just look at every other attempt at mega farming. There have been lots of them on the prairies, especially in the 1920s(at least in this area) They have all failed. All of them.

Grain farming on the prairies is an insanely low margin/risky business to be in. Family farms survive because they have skin in the game and are willing to sacrifice when times are bad. The same is not true for hired labour and management of giant corporate operations. They would never be willing work for nothing, like family farmers do from time to time. Try telling a hired equipment operator that he will not be paid for 9 months because there is no cash in your account. He will not be around for long.

There will be a bankruptcy auction, I know it. And I'll be there as a happy scavenger.

[bucket]

I look at this farm and if I tried to hire everyone to do the jobs that have to be done, I would be out of business so quick it would make my head spin.

Not to mention workers show up and if they break something someone else fixes it.

Then you have the ceo to pay and all the investors.

If they are 10 times my farm size and I figure I am running pretty lean - I doubt the ceo and investors would have a million clear to split up. Consider the upstart costs and learning curve costs. Good on them if they do it but, I am sorry, I can't make sense of this.

Silver makes a good point about retailers getting in bed with these guys. The locals who made the retailer all of sudden are the bad guys for not paying immediately meanwhile the large corp. farm has 90 to 180 days and when the retailer can't make cashflow - he squeezes his reliable customers. Seen it happen - some guy comes in with some expansion scheme and the retailer falls hook line and sinker then starts pestering others for quicker payment because the other guy is gone. Pretty soon everyone is on cash, agline, credit card because the retailer wanted to win that lottery.

A horse that shits fast doesn't shit for long!

[furrowtickler]

Cotton, your jokeing right?
Rich people will make very poor farmers.
Who is going to do the actual work accross that land base, natives? This is a b/s dream that will fail within 3 years, no matter how much investor/gov't money is thrown at it. Someone has to opperate those tractors/combines ect. To cover those kind of acres it will take large efficient machinery that will be operated by inexperienced workers - that will be the weakest link leading to a very high percentage of that land farmed completely inefficient.
I see this first hand not far from me.
As well, way too many fingers in the pie will lead to zero or negative profit due to below average yeilds caused by the factors above.
It only takes one or two things to go wrong and it can result in a huge yeild drag, as we all have seen in our farming opperations - and no amount of money can change that.
It will make no difference if Sprot is a billionare, if the guy operating the airdrill seeds 1/2 in too deep/shallow, 2mph too fast, sprays the wrong chem, sprays 3 days too early/late, does not set the combine right ect - any one of these or in combination will be highly detremental to yeild thus proffit.
Then mother nature steps in!! But -JMO

[fjlip]

There is a lesson for all on size. There is a right size for everything and the more hired labor the less efficient. Every one involved needs to be liable for losses. That keeps you going when times are crappy. That makes you try harder. Good luck on staying the right size. Greed is in play all around us. Don't be sucked in by thoughts of efficiency, bigger only to a point is better.

[SASKFARMER3]

Our farm was double the size of most in 50 60 70 then 80s we pulled in our horns then expanded again in 90s. Now were not the largest in our area but third or fourth who cares. The next step for me to expand has a huge cost, having way to much fun time at the lake camping with kids to take the plunge these guys can eat it all up I for one couldn't give a rats ass. Your only as efficient as your next meal. Mother nature can screw up a great plan 9 out of 10 years. It's farming. These guys will fail and it will be one hell of a fun auction.

[cottonpicken]

What will they pay for inputs?

Who is going to get first shot at grain contracts and
delivery?

What kind of government/indian conseccions will
happen?

How much in taxes will they pay?

These guys have an angle.

[SASKFARMER3]

I agree their is something very smelly when all who farm know the risks we didnt just jump into our occupations.

[furrowtickler]

Cotton, good points.
But............
Inputs - not alot of margine left with current prices to have much of an inpact
They may get a "first shot at contracts and/or delivery" but that will depend greatly on the quality of grain/oilseeds
Conseccions will be there without a doubt
Taxes - with the peolpe involved taxes will be non-exsistant for the most part.

One must remember this western Canada, not Brazil, mother nature will still dictate what can be done large scale. Time frames are the biggest constraint larger opperations - and they vary dramatically year in and year out.
If One earth models itself from the Hutterites, they may have a shot - But too many people will demand too much return, imo.

[NISAcase]

I predict first investors loose their shirts but Iogen steps in to pick up the pieces. No mention of the carbon credits to this point to ward off the intolerable heat from CO2. I guess I am first. I will later up date you on Wilm Hosenfeld's (Movie Pianist by Roman Polanski') drinking buddies on October 17, 1944 in Warsaw ghetto of World War II clean up operation. One spends rest of his life in Russian prison and the other in Ottawa. Its good to be related to the Kings and Queens.

[NISAcase]

S3, I don't think you understand exactly how farm the current programs work.

I do not disagree with the chances of this organization making a go of it, but the over profit/loss of the entity is not what programs are based on.

Its all production and producing it as efficient as possible. As long as they have reasonable production, they will establish a margin history. Because they are a new farm, they will have start up margins based on an area calculation for the years missing. If they burn up their profit through high compensation to owners, high lease costs for equipment, high rent for land, it doesn't apply to the programs reference margin calc's.

Like I said at the beginning, I don't necessarily support what the emerging "corporate farms" are doing, however, everyone must remember that having an operation of that magnitude in your area has driven up the price of assets that you own. For those that rent, a negative impact may have happened.

The question is, someday the may bubble break and those that are close to retiring from the business need to consider getting out before this occurs.

[DogPatch]

This whole business sounds so much like Big Sky...... Think about it. How can a big CEO in Toronto run something like this and keep everyone honest and profitable. It won't work. I certainly hope they don't count on local input suppliers to bend over for them.

[Hopperbin]

I believe Larry Rudd is managing this operation. Does he not live in Western Canada somewhere? Google him he seems a busy guy.

[Hopperbin]

Any bets Elaine Fraise will be on speed dial for the cell managers?

[bucket]

Hopper

Do you think Rudd is working for free on this venture?

Do you think he would be taking an average farmers salary out of the operation?

Do you think he sat on any piece of farm equipment if the farms were short of help or harvest was late?

If not then sitting in an office pulling cash from operations, would in my view, be a drain on resources and returns.

I kmow some would say you don't have to involved to run the farm and a farm that size needs someone to manage the operation but these guys are renting most of the land they farm. That means more than likely 25% of the net is gone ot first nations. If you pay your investors 5% of their investment and then have management fees, sprott fees, now you are down to paying for fuel, fertilizer,chemical, freight (last time I checked freight took 1/3 of board grains) and labour.

If they grew any board crops they haven't produced alot of cash flow. Unless they used the "entitlement card" and bypass the cwb.

Here's another question:

Since they are one entity how much advance would they be applying for?

I hate being negative about this but I just can't see the returns on this. Sure they keep sinking money and getting money by saying they are expanding But if they were making money - would it not be self sustaining and growing on its own?