Are BTO’s Causing Problems?

[ajl]

What will happen if they lose control of interest rates?

Interest rates should be set in the marketplace with multiple parties buying and selling rather than by a quasi government agency like a central bank. The sole purpose of a central bank is to suppress rates by printing money. They print as much as they can without igniting hyper inflation. But inflation is hard to measure so this can't be done with precision. We see that with different inflation rates in the economy. Farm machinery parts +25% per annum. Now if the B of C was closed tomorrow, rates would likely rise 2-3% which of course would finish Canuckistan off by noon tomorrow since it is entirely dependent on being propped up by cheap debt. Something new would emerge from the ashes though eventually.

[fjlip]

Agree, stuck in low interest rates or the whole house of card comes down! Good friend at 8000 acres admitted "it is crazy stressful to farm that much" , unhealthy, busy as hell, risky as hell. So only some can handle the BTO lifestyle. Others won't live long doing it. Lots of estate/divorce/bank auctions in future. We had many HUGE operations over the years in this area, none lasted for one reason or another.

"If you compare yourself to others you may become vain or bitter."... real accurate, or "be happy with less" even better, "how much is enough?" Get the same plot/hole in the end...think

[countryguy]

Topic of coffee shop conversation: Consensus-

1. BTO’s raised the land rents and price for ground - young locals are shut-out of land market.
2. BTO’s operate on borrowed money so payment pressure causes commodity dumping.
3. Dumping culminates in reduced returns for others.
4. BTO’s swallow up local smaller farmers, they move away and small communities suffer.
5. Neighbour interaction is non-existent. Remember the days of neighbours helping each other?

The forum is open - the can of worms is open.

I will strongly agree with #3 but its not just the BTO that is guilty of it. Plenty of small farms around too that have a bunch of wants around that aren't necessarily needed but have to be paid for. There is competitiveness between all sizes of farms.

[furrowtickler]

BTO’s or not , everything has been pushed to unsustainable levels for risk management now for many reasons. Case in point look at what’s happened now ..... it has been unsustainable for a few years , lucky dry harvests and decent yields lately have made it barely doable .
Add in high moisture grain , big grade losses / discounts , very high drying costs , high land rents , input costs rising .... it’s going to be a train wreck sooner than later . No single thing to point blame at , its a combination of several things at once with Mother Nature cutting the last string for some . And a lot of hurt for many .

[hobbyfrmr]

If you compare yourself to others you may become vain or bitter.

Agreed.

[farmaholic]

If you compare yourself to others you may become vain or bitter.

....or both.

Every one should do what they want...don't judge me for being a Sandbox(play) farmer from the Slum of the Ghetto, even if you do, I won't judge your choice. Not everyone is cut out to be either a small or large farm operator/manager. To each their own.

I won't begrudge anyone their success but sure as hell won't mourn their failure either.

I will do the best I can to chew what I have bitten off. But if someone never gets enough and needs to be "rescued", I'm not chewing what someone else bit off. The worst is the guy who does get rescued then takes on more thinking "HE" got done...over and over again.

There are some very well managed and run BTO operations out there. When they succeed they deserve it.

What's stopping anyone from taking the plunge?

"Most" days I'm satisfied waking up knowing that day all I'll ever be is the Sandbox Farmer from the Slum of the Ghetto.

[Oliver88]

I will mind my own business when some off these guys start minding theirs....no write downs only to retry a few years later ...

Solid points made by all comments so far.
As bucket noted, it seems the root cause for a lot of past problems in Saskatchewan Ag is weak bankruptcy laws/write downs/Land Bank, etc.

Not necessarily by only BTO’s though....

[Saskpraireboy]

I agree with the comments that there is some very good big operators around. Everyone is free to have a go at joining them if they think they can handle it . After working 30 years both farming and working a fairly high stress city job I decided that one of them would have to go.

Rented out to the local 60,000 acres guy. Three years ago.
Why would I do that many of you would ask, what about the little guy ? Or the young guy , give it to them.

Well I guess there is a few reasons first one being that I have watched this operation grow for 20 plus years. They do a very good job of farming and farm rented land as good or better than the dirt they own. I like that. Can't say the same for some other operations who want to bale straw on only the land they rent or the rented dirt gets sprayed last If difficult conditions persist.

Top rate paid on the first call. I didn't feel like shopping my dirt around to multiple farms and haggling or bargaining on cash rent. I knew I would get as good or more than fair market value on one phone call. I liked that . Yes I called them.

Things always done on time. For such a big farm they are always one of the first done seeding , harvesting spraying ect in this area. Since they started to grow big 20 years ago they have been able to stay ahead of the curve and continue to get things done on time . I like that.


Clean fields, nice crops grown . I like that

Rent is paid exactly on time. Hand delivered with a small thank you note .I like that.

The main operators are late thirties or so and continue to operate equipment in the field as needed so I don't see them going anywhere any time soon. They have skin in the game and work extremely long hours. in the busy seasons . Like the hard work and there defiantly seems to be pride there.

So really , why not rent to them . I don't owe anything to anyone . Top rent, and my land gets farmed very well.

[furrowtickler]

I agree with the comments that there is some very good big operators around. Everyone is free to have a go at joining them if they think they can handle it . After working 30 years both farming and working a fairly high stress city job I decided that one of them would have to go.

Rented out to the local 60,000 acres guy. Three years ago.
Why would I do that many of you would ask, what about the little guy ? Or the young guy , give it to them.

Well I guess there is a few reasons first one being that I have watched this operation grow for 20 plus years. They do a very good job of farming and farm rented land as good or better than the dirt they own. I like that. Can't say the same for some other operations who want to bale straw on only the land they rent or the rented dirt gets sprayed last If difficult conditions persist.

Top rate paid on the first call. I didn't feel like shopping my dirt around to multiple farms and haggling or bargaining on cash rent. I knew I would get as good or more than fair market value on one phone call. I liked that . Yes I called them.

Things always done on time. For such a big farm they are always one of the first done seeding , harvesting spraying ect in this area. Since they started to grow big 20 years ago they have been able to stay ahead of the curve and continue to get things done on time . I like that.


Clean fields, nice crops grown . I like that

Rent is paid exactly on time. Hand delivered with a small thank you note .I like that.

The main operators are late thirties or so and continue to operate equipment in the field as needed so I don't see them going anywhere any time soon. They have skin in the game and work extremely long hours. in the busy seasons . Like the hard work and there defiantly seems to be pride there.

So really , why not rent to them . I don't owe anything to anyone . Top rent, and my land gets farmed very well.

Lol , well I hope it all continues to go awesome for you lol . Yup guys have never been stuffed in bad times lol
Hope the best for you 👍
It’s happened here , more than once by the biggest and bestest of em lol

[furrowtickler]

Most of us have pride and hard work and education, Mother Nature will dictate after that . Even the best of the best get hit by a train 🚂 once in a while , hopefully that don’t happen for you .

[farmaholic]

Rent er all to Babich !

They ll Farm it all !

Can you imagine the critical mass and momentum a successful farm like that has? But I'd hate to be around if things go bad👎.

[farmaholic]

The bto could be a problem if he offers 500,000 a quarter and the Farmers kid had expectations of buying it for 60,000 over time !

Just sayin !

Strange things happen when it comes to Land !

At what point does continually getting bigger become just an obsession, or an "I'll show you"(competition) attitude or as much as I hate using this word, just plain "greed".

I sometimes look at how many people BTO farms are directly supporting and think everything is relative, to a degree.

Today, I wouldn't trade my farms financial status and size for some of the highly leveraged large acreage farm operations. I'm not saying we couldn't handle afew more acres and wouldn't buy them if the right ones came up for sale but for now I'm satisfied.

I find some people's goals also depends on the company they keep...or what the in-laws are doing. lol.