Money in Bank vs Owning land? I think the tides have turned.

[jamesb]

I would agree that the best opportunities come when things are the bleakest. In those times it is very hard to have a good return and a good plan is one to survive till things improve. In the 90's land could be on the market for years as no one could see that things would improve. We rented some neighbours land for taxes for a few years. They just wanted out. The lowest land prices we paid in the 90's was $65000 for a half section. Neighbouring land to this sold for $160000 per quarter this past year.
Yes I know we have entered an era where the "land investor" is competing with the farmers for the control of the land but as a farmer my desire that the land value goes up is of far less consequence that the need to generate a profit on the land to provide a living. We have gone through a decade of strong land values and I feel that the investors today are going to be disappointed for the next 10 years. The reality is that most farmers are willing to accept a extremely low return on investment. Investors simply will not stand for low returns for any length of time. We are starting to see the investor sell the land back to the traditional family farm in this area.

[Klause]

Well because, sometimes events conspire and you do make a profit. At the very least you are paying down an asset that might be more valuable in the future. While you are paying it down, its positive cashflow ability should be increasing...technically.

I assume klause is referring to land coming into production from the old soviet bloc countries. Thats the probably only place where land can be brought online unless you think we are going to knock down amazon forests. If there is new land coming online, its being farmed by much less efficient farmers than us and its probably in politically unstable areas or places much more susceptible to weather. Its not a threat, but I agree the threat from our own govt is much bigger.

4 million acres - Ontario due to climate change.

Kazakhstan - 10 million acres
Russia - 22 million acres.
Argentina - 2.2 million acres

Less efficient? Are you kidding? Kz, Argentina, Russia are half as expensive to grow crops here and their yields surpassed ours long ago.


Canada is the highest cost lowest return production area in the world. If you can't see or believe that you need an education in geography and politics.

Efficiency needs to be measured in dollar in = dollars out. Bot how many acres one person can farm.


Sebody had that chart of cost per but of wheat to produce for the major production areas... They should post it here again .



Oh, and none of those areas are rainforests.


We didn't even talk about the massive ag development happening in Africa thanks to Chinese investment or Chinese technology that's turning baren deserts into farmland.

[jazz]

klause, I suggest you read some Peter Zeihan on why the north american ag system will dominate in to the future. That doesnt mean that land values cant fluctuate, but I am not going to fear a country where the average life expectancy is 60 and declining demographically, nor another who is teetering toward a full socialist state with its neighbors, nor another that has to cross 5 other countries to get its wheat to port.

If there is all this magical land in Ontario I never heard about, then they will grow corn and soya there. Thats not a threat to us.

The china investment model will fail. They have invested in the most unstable places in the world. Good luck to them trying to operate businesses in Pakistan or South Africa.

Its easy to get caught up in the doomer mentality, but perspective is in order. These places are 3rd world countries operating in other 3rd world countries. They pose no threat.

[Klause]

klause, I suggest you read some Peter Zeihan on why the north american ag system will dominate in to the future. That doesnt mean that land values cant fluctuate, but I am not going to fear a country where the average life expectancy is 60 and declining demographically, nor another who is teetering toward a full socialist state with its neighbors, nor another that has to cross 5 other countries to get its wheat to port.

If there is all this magical land in Ontario I never heard about, then they will grow corn and soya there. Thats not a threat to us.

The china investment model will fail. They have invested in the most unstable places in the world. Good luck to them trying to operate businesses in Pakistan or South Africa.

Its easy to get caught up in the doomer mentality, but perspective is in order. These places are 3rd world countries operating in other 3rd world countries. They pose no threat.

You really are dillusional.


First of all go research the "Great clay belt of Ontario"


They grow barley wheat canola and some soy. 60bpa+ canola yields have been attained.

Land that has infrastructure and market access (Toronto is 5-7 hours away).


Argentina started double cropping ten years ago... Effectively doubling productive capacity.
Russia managed to double their export capacity inside of 4 years.

The amount they increased by last year is our ENTIRE EXPORT PROGRAM.


Farmers here that we're too shortsighted didn't see coming what happened to our pulse industry. It's gone. Done. It isn't coming back for a long time.


Ignorance of the world, incompetence, and a lack of vision will bring Canada to the status of a 3rd world nation so quick nobody will know what happened.



You can operate anywhere in the world if you know how to.


Look where most of our oil comes from.

Don't think it's possible? Research a few companies like Olam.

Coincidentally they operate in every productive area of the world except Canada.


Wonder why that is...


And for the love of all things good in Canada quit insulting the Chinese. Right now China is the only reason we even have reasonable canola market.



We are a declining civilization, or haven't you noticed that? We care about stupid social justice crap. Can't even get a piece of steel pipe in the ground to export oil.


By the way, the average life expectancy in Russia is just over 70 years. Quit reading fake news CBC.

If you think Canada's media is open and unbiased... LOL. It's all propaganda, you just live inside of it so don't see "truth." The irony of accusing other nations of the same.

And the arrogance of somehow thinking we're better than the entire world simply because ?????? Commenters on here want to build old folk's homes instead of high speed transit. Infrastructure for decline vs. infrastructure for expansion.

Meanwhile those "third world $hitholes" are building entire cities in decades.

They're building arctic export terminals that we never got off paper.


They're putting in new railways.

They move more production into an export position in a week than we do in a month.

So please, give me a list of advantages.


Then explain why for almost a hundred years, Canadian farmland was the cheapest of any of the productive areas of the world...?

I don't understand why we aren't screaming at the top of our lungs as a nation.... that we need more modern cities, more modern highway systems, passenger trains, better connectivity, better cellular networks, more social infrastructure. All of this costs money, brings jobs, jobs brings people, people bring industry, industry brings money.

Yet instead we go galavanting around the world telling them how much better we are. As our markets get taken away, our competitiveness eroded, and quality of life drops.

[lnjr]

Klause you are always stating how much better it is to farm in a number of countries. So why are you farming in canada?

[Klause]

Klause you are always stating how much better it is to farm in a number of countries. So why are you farming in canada?

That question is getting old.


How do you make things better? Learning from other's examples, improving on them? Self-analysis, and self-criticism to see where we can do better?


Or living in fairytale land thinking we're the best, always were the best, always will be?


Why is the first reaction to somebody saying "we need to do xyz better to have a better advantage" always "Boohoo we don't like you why are you here"?

Do you want your children living in a third world $hithole? I don't.

Our businesses are adding debt without competitiveness.

The public is in debt over their eyeballs

So is the state.

We have nothing to show for it. Name a major infrastructure project built in the last decade... The last major project was the bridge to PEI.


We buy our fertilizer a year in advance, store our grain for a year after production, and float the entire "agribusiness" system in this country - nobody else does this anywhere in the world. How long do you think that'll work with higher interest rates? There's no elasticity in primary production income to pay for that... Nobody talks about this issue, or even brings it up... we're talking about buying land and paying for it, never mind the business of production agriculture.


Owning land is always a good thing... owning land in Canada is a good investment. Just not at inflated prices.

[macdon02]

Read Zeihan, Klause.

[bucket]

Well put Klause ,,,,,just gotta wait for the leeches to be bent over....

[jazz]

So klause, I assume you are in support of 100 million people being added to our population because if you want all those things, you need to have a much bigger tax base to draw from. Hopefully the extra 100 million people can find work - kind of a chicken and egg thing. Those countries all have debt too, lots more. China has trillions of off book debts lurking in their corrupt markets.

Sure China has high speed rail, but it also has facial recognition cameras installed all over the country. We will see how their economy responds to its first real depression or when the people get a taste of consumer freedom and want real freedom. See what happens when automation puts a few hundred million out of work.

Russia grows lowest quality of wheat on the planet. They can go feed all the poor people if they want. We should target high quality first world consumers who have money.

I hate canada's SJW turn for the worse as well and it definitely could impact our standard of living and I abhor the Liberals and their identity rights politics and the lack of infrastructure as well, but most countries get things built by much more strong arm tactics. They would laugh at our soft ways. On this I am in agreement we could be definitely falling behind. Whether that will affect a raw commodity that is exported to the rest of the world remains to be seen.

[Klause]

So klause, I assume you are in support of 100 million people being added to our population because if you want all those things, you need to have a much bigger tax base to draw from. Hopefully the extra 100 million people can find work - kind of a chicken and egg thing. Those countries all have debt too, lots more. China has trillions of off book debts lurking in their corrupt markets.

We need 150 million people in this country. Then we'd have the critical mass to actually have successful industries, and we could rely on ourselves instead of export markets. Build infrastructure, create jobs, jobs bring people, people bring money, and on it goes. Why do you think the USA was so successful in attracting people from all over the world?

Argentina and Canada had populations that were similar. Argy has 10 million more people than Canada now... Immigration, not births account for most of it... why would a third world "shithole" be more attractive than Canada? We need to ask ourselves that.

Sure China has high speed rail, but it also has facial recognition cameras installed all over the country. We will see how their economy responds to its first real depression or when the people get a taste of consumer freedom and want real freedom. See what happens when automation puts a few hundred million out of work.

Not sure about your camera comment. Toronto and Vancouver have them also, as does (most famously) all of England. They can track movements of their citizens 24/7 in London.
Not all people want

You don't seem to understand, China doesn't have a western culture, their social structure, societal norms, and governance are different - always have been, always will be. I'm not going to get into religious and societal feelings here, but there's lots to study there.

Russia grows lowest quality of wheat on the planet. They can go feed all the poor people if they want. We should target high quality first world consumers who have money.

Two things with this statement.

First of all, that was true once upon a time in the days of Soviet collective farms.

Not today. This is an analysis of Russian wheat. Note protein above 13%, 30% gluten, and the fact they get worried with fusarium at 0.4-0.8%. Our #2 standard is 0.8% or better. This is a major issue in "high end" markets.
http://tusaf2017.org/wp-content/uploads/2017/04/Sergey-Chumak-ENG.pdf http://tusaf2017.org/wp-content/uploads/2017/04/Sergey-Chumak-ENG.pdf



Second, how do you propose we get our wheat into those "high end, premium first-world" markets... That would be Europe and Japan... They don't want glyphosate pre harvest treatments (as is evidenced by a clear lack of a durum market right now - Italy was a major first world buyer that went elsewhere). You want us to go after premium markets - which I agree with - but somehow here in Canada we're so ignorant and arrogant that we think we can tell those premium markets what they should buy... Instead of catering to them.

I hate canada's SJW turn for the worse as well and it definitely could impact our standard of living and I abhor the Liberals and their identity rights politics and the lack of infrastructure as well, but most countries get things built by much more strong arm tactics. They would laugh at our soft ways. On this I am in agreement we could be definitely falling behind. Whether that will affect a raw commodity that is exported to the rest of the world remains to be seen.

Really?

GDP per Capita in Canada has been dropping since 2016. Currently, investment flows are less than 30 billion into Canada, and 100 billion plus out of the country (it was exactly the opposite 10 years ago).

Humanity in 3rd world, or developing countries wants to get ahead, they want better for their families, for themselves, for their children. That thirst, and drive is going to get them places - Here, we're too busy worrying about penises and fake women issues to have any drive.

That pipeline will never get built to the coast... Unless something changes.

Unless we get our export business in order we are toast. That's already being felt in pulses, wheat, and oil.

With the current dynamics with America, it'll become very painfully evident since we can't just send things south anymore.