Here's hoping for an economic reset soon in ag

[bucket]

I have said this before ....6000 bushels bought a new combine in 1975....

Harvest got done with smaller combines and more farmers.....


If guys like growing more and making less per bushel it's not going to end well. ...

And this time when the write downs come it will really piss the careful guys off...


If land prices drop 10 percent there are guys underwater very quickly...

[farmaholic]

How much money do people think Dads and Grandpa's had?
Sweet tweet compared to the dollars it costs to run any size of farm today..

This is a very true statement. It isn't only the "money" the past generations had saved but also the paid for leverageable land they owned!

Well, I guess if daddy and grand pappy saved enough money for retirement so they never had to sell the farm at full market value to the next gen in order for them to have enough to retire on....that makes a difference too.

But think about what partners said...what is a new line of equipment worth and how much does it cost to put in a crop.

[SASKFARMER3]

I like the comment Daddy's money and Grampas money. Yea retiring and having a 100000 back in the 70s was ok or a 1000000 was great but after taxes and dividing between family really how far would that go. Maybe buy a quarter or two in the 70s then the 80s hit if you bought you lost as land dropped. Yea land went from a high in 1981 of 160 to 190 a quarter down to 54 and yes I bought at the lower. Ugly times only one who bought at high is still farming and bought nothing for 25 years. Remember history.

Fast forward today So your left 1,000,000.00 to 10,000,000.00 Land is again back at the top, my question is why the F#$K would you farm with that kind of money left to you other than a tax loss.

THe million can give you a nice check of $50000 a year and pay taxes on and have fun play farming at the size your at.

Or the ten million giving you $500000 at the size your at or let your kids play farm.

Sometimes I wonder if farmers really are that bright.

The land has value yes I agree with that but buying at today's price just to have more and it sure looks like a reset is coming. Yes, it happened before three times read history.

I know a couple for sure on here that are exiting at the top and good for them they see the reality in the game the real winners are the suppliers and equipment dealers and grain companies, farmers are dead last and do all the work for pennies. Any smart businessman knows when its time to exit. Relative in City who had a furniture store and was offered stupid money, really stupid money for his building said he thought about his decision for oh say 10 seconds and asked for a little more money and got it and didn't reopen the store but retired.

Farmers lets piss it away over a few more years and see if it gets a better attitude.

[farmaholic]

I've asked the question, "do you owe your kids the opportunity to farm"?
If they want to. The same one you got. Things are definitely at a different level now than when I was given my start.

[SASKFARMER3]

Yes, my kids have the opportunity to farm but get out, get an education and get a job to see what its like to work for someone other than your family then if you want you can come home and farm it's not going anywhere.

[bucket]

I heard it the other day from a farm group rep " ...do you want government involvement?...."

Most farms wouldn't be here without it.....the guys with dad's and grampa's money more than likely saved the government money thru the years. ...

I wish people would understand the pulse producer is getting shit on...even the saskpulse board doesn't understand reality...

[macdon02]

How much money do people think Dads and Grandpa's had?
Sweet tweet compared to the dollars it costs to run any size of farm today..

Depends how big the life insurance was ..... no one talks about that but they'll be the first to say how good of farmer they are. Took me a while to figure it out and I'm not implying anything to you personally by quoting. There's some massive policies out there and all sorts of games going on loading gramps up with new line of land and iron

[Ache4Acres]

The only reset coming is going To be a broad based reset. Every industry is overdone just like Ag and once interest rates rise - pop goes the bubbles.

But when everything drops , nobody is protected, it won’t matter where you squirrel away your money. Down she goes.

That being said, Holding cash the last few years has been a painful experience. Anyone that thinks overall inflation is less than 7% is delusional IMHO. Money has always become nearly worthless within two generations and that is accelerating. $100,000 50y ago was a nice savings, today it’s a nice half ton.

I would agree, be careful what you wish for

[Taiga]

It was posted above that the real money was being made by the Equipment dealers. I don’t think that is true. RME’s latest posted results show 2% profit. That is not great by any business standard. That is grocery store level. Many dealers hover on the verge of bankruptcy. I think the Equipment prices we are seeing are:
1) costs have been subjected to massive inflation inflicted upon us by the Trudeau impact, CAD dollar is shits and buys nothing
2) increased manufacturing costs due to increased technology. $20,000 just to have guidance ready machine and GPS system, etc.

I am semi retired and farm on the side and enjoy it, fantastic lifestyle, but I sure don’t make any real money. But at least I am honest with myself.

[ajl]

RME inflated there cost structure through building a lot of brand new expensive store sites. Now they have to digest that in an ag recession. The shares have not done well lately but that is there own fault.