Area One Farms

[helmsdale]

The Mantra direct from their website...

THE ERA OF THE SMALL FAMILY FARM IS BEHIND US
Farms need to grow to stay on the map and working with the bank to get bigger is getting harder to pull off.

We believe in keeping farms and families together, and we’re working with farmers across Canada act on opportunities that allow them to quickly expand their operations without debt

This "small family farm" is still standing... The massive cash burning behemoth? She's likely going to hang alot of creditors.

[seldomseen]

Sounds like the same crap Pike management would spew but on a grander scale. We all know what happened to them!

[MBgrower]

The smell of money is better than the smell of paint.

[farmaholic]

The smell of money is better than the smell of paint.

And both together is even sweeter!

Everyone who has shiny paint isn't broke or operating on the edge.
There are some well heeled farms out there.
New paint is my reward for paying off land early and farming with used equipment and pulling wrenches on it for decades.
If I had plans of quitting I would be using up the early big depreciation of the "current" machinery I have and then bowing out with an auction of a good used line of equipment and renting out land.

[Crestliner]

Is Area One Farms in trouble or going out of business?

[helmsdale]

Is Area One Farms in trouble or going out of business?

No... I resurrected this thread I started last year for context. One of their progressive farmers that they "partner with", is liquidating WELL AHEAD of their intended 10 year horizon.

Couple of average year crops, max inputs, and gargantuan capital outlays are sinking a splashy operation.

[Crestliner]

No... I resurrected this thread I started last year for context. One of their progressive farmers that they "partner with", is liquidating WELL AHEAD of their intended 10 year horizon.

Couple of average year crops, max inputs, and gargantuan capital outlays are sinking a splashy operation.

What auction sale is that?

I personally don’t think there is enough net income in grain farming to grow the farm with earnings and take care of investor returns as well.

Why are farms so chronically undercapitalized?

Because the farm doesn’t make enough to carry the demands of capital required.

Yes we have a few good years, high prices or high yields....but when it happens, the cost side is quick to respond...higher rents, higher inputs and don’t mention the Royal screwing equipment is giving us....but most of the time farming is SLOOOOOOWWWWW MONEY!

We have had a big bump in asset land values in the last 10 years...some guys have turned that equity into borrowed money and I think I sometimes people think that’s their money....big surprise coming for those.

The best capitalized farms are inter generational farms that have been well managed, grown from retained earnings and the families have gotten along and no big divorces or sibling blow ups...like I said SLOOOOOOOOWWWWW MONEY!

The Broad, Input, schemes and Private investor farms will come, occupy some space in the industry, but the family farm will endure, it’s the best structure and my gawd needs some support and programs from all levels of governments that encourage its survival and thrive.

[rumrocks]

The tortoise and the hare come to mind.

[15444]

What auction sale is that?

I personally don’t think there is enough net income in grain farming to grow the farm with earnings and take care of investor returns as well.

Why are farms so chronically undercapitalized?

Because the farm doesn’t make enough to carry the demands of capital required.

Yes we have a few good years, high prices or high yields....but when it happens, the cost side is quick to respond...higher rents, higher inputs and don’t mention the Royal screwing equipment is giving us....but most of the time farming is SLOOOOOOWWWWW MONEY!

We have had a big bump in asset land values in the last 10 years...some guys have turned that equity into borrowed money and I think I sometimes people think that’s their money....big surprise coming for those.

The best capitalized farms are inter generational farms that have been well managed, grown from retained earnings and the families have gotten along and no big divorces or sibling blow ups...like I said SLOOOOOOOOWWWWW MONEY!

The Broad, Input, schemes and Private investor farms will come, occupy some space in the industry, but the family farm will endure, it’s the best structure and my gawd needs some support and programs from all levels of governments that encourage its survival and thrive.

Need to print that and send to every MP, MPP and scum-sucking checkoff group. But the hot air will blow it right through their heads.

[poorboy]

Helmsdale,

Is that the operation on Highway 570 just south of Blood Indian? Sure looks out of place there.

[blackpowder]

So, I watched their video.
Ya, it hinges on two things.
Buying undervalued land. And leveraging your own under secured land.
Never see these guys in this area at $5000/ac. Although I know of one accountant pushing over leveraged guys to sell some dirt to an investor group and lease it back.
Whatever the model in the future, there's only so many dollars left at the end of the year. And there will always be years everyone is staring at a negative.
Any model might work. But the players will have to accept the negative years.

[iceman]

A link or it didn’t really happen!

Iceman