FCC changing their tune.

[bucket]

What are your thoughts on the economics of that setup?
When would you actually sell the grain? How much would you be willing to pay for storage if you wanted to keep ownership?

No one let's you store grain...besides three years running so called dumping grain at harvest has been a fairly effective strategy when you figure out those on farm bins and 2 on farm elevations with the auger.....

[hobbyfrmr]

Solid points.

Agreed . US farming website farmland buy/rent prices conversations turn to the fact that too ultimately over pay for the priveledge to farm. Its a farmer thing. If they make profits they immediately put it into farmland purchase or rent prices. This makes me think think of the Buffet thread where he knows when a stock is undervalued and time to buy. It looks like farmers work the opposite way. Not laying blame, furrow noted an observation which I strongly agree that the “rules of business” are backwards in ag.

[Crestliner]

Well, kind of I guess. I have always thought that farming is always cash poor. There is never quite enough money to do things “right”. Thats why, as furrow acurately describes we become the welder, gas mechanic, heavy equipment mechanic, accountant, machine operator of every single machine on the yard, so on and so forth. Those farming ventures were well capitalized, they should have, kicked the hell out of any competing grain farm for miles. Especially in the time of high prices.
Instead the smartest guy in the room (Pike) shorted FCC tens of millions, and shareholders. It is incredible that they continued to pay the guy a salary to wind down the project.
Not so much sarcasm, more like the wonder in the irony of it all.

FCC never lost a dollar on Pike...they were the secured creditors. Different story with the unsecured....which is the case all the time. FCC knows how to cover themselves very well and rarely lose.

That’s why they lend max 65% on their land value appraisal....which really is 50% of actual land value....so boys better have half the cash on the dash or lots of equity to play the game at the big land prices today.

Go ahead take that hard earned cash sitting in the Bank, make the deposit into the neighbors land you always wanted and your kids or grandkids will be the lucky ones to make the withdrawal....lol (if they don’t screw it up!)

[Klause]

FCC never lost a dollar on Pike...they were the secured creditors. Different story with the unsecured....which is the case all the time. FCC knows how to cover themselves very well and rarely lose.

That’s why they lend max 65% on their land value appraisal....which really is 50% of actual land value....so boys better have half the cash on the dash or lots of equity to play the game at the big land prices today.

Go ahead take that hard earned cash sitting in the Bank, make the deposit into the neighbors land you always wanted and your kids or grandkids will be the lucky ones to make the withdrawal....lol (if they don’t screw it up!)

Huh?


That's what a credit union does
FCC will lend 85% of the average area value.

[Crestliner]

Huh?


That's what a credit union does
FCC will lend 85% of the average area value.

You have a nice FCC guy or you are Gold Plated client or both. Last time I checked FCC land values used for financing in my area was 18 months behind current value. But hey whatever works.

A Lawyer friend of mine whose firm does work for FCC told me they were happy and well covered. I don’t think Broadacres bought land just rented...so maybe it was just inputs....it’s all history now.

[parsley]

Does FCC finance Poplar Trees 🌳? Lol

I heard that 😄

[Klause]

Bucket ! You would like South Australia !

They haul grain off the combine direct to port then sell to grain buyers thru out the year when the price is right !

No need for on farm storage bins just a few chaser bins to keep the combines and trucks rollin !

Same way it works in South America... Europe... Russia... The US...

[bgmb]

Off the combine is worst basis of the year always. bins pay within 5 years easily. Easy to make 20-30 bucks a tonne on canola just in basis from off combine to winter

[Klause]

Off the combine is worst basis of the yeal always bins pay within 5 years easily

Not in sask...

Peas off combine $8.50 now $6.60

Hrs off combine $7.75 now $6.67

[makar]

A cargill dork told me you farmers have to forget about selling your crop in a crop year, havent talked to him since.

[bgmb]

Not in sask...

Peas off combine $8.50 now $6.60

Hrs off combine $7.75 now $6.67

Apples to apples, in the summer when wheat was high you could have locked say 8 sept 820 dec and 835 march hrs wheat. Basis gets better as your u go out. With canola you are virtually guarinteed ro pick up 50 cents a bu in basis storing from sept to march just in basis. Never mind seasonal canola chart is highest in the spring.

[Klause]

Apples to apples, in the summer when wheat was high you could have locked say 8 sept 820 dec and 835 march hrs wheat. Basis gets better as your u go out. With canola you are virtually guarinteed ro pick up 50 cents a bu in basis storing from sept to march just in basis. Never mind seasonal canola chart is highest in the spring.

$0.15 a bushel to haul in the middle of winter, pay interest on that money for three months (opportunity cost), pay for bins, and pay two x elevation costs with... Yeah ok... That doesn't make you any more money.


Plus you're then fighting winter movement which is terrible in Canada and in the case of canola dealing with a highly volatile easily spoiled product.




Don't get me wrong some storage is a good thing but why you think farmers storing a crop for half or a full year, incurring pricing risk, spoilage risk, and act of God (fire flood wind) risk on that commodity in order for the elevator and rail system to not have to become more efficient is a great idea is beyond me.