Any benefit to an older farmer if they finance a younger guy on their equipment?

[flea beetle]

flea, you have heard about the $150 an acre being tossed around.

Does it pencil.

And most of all, a 50% increase in acres would say you need some more bodies.

Yes I have heard of the high rent numbers flying around. Not quite $150 here. More like $90-$130. Not gonna worry about the numbers until we actually talk about them. This was initial contact to see if I was interested first and foremost. I believe he will be more than fair with his land. Can’t speak for his landlords, but I suppose I will find out soon.

My only apprehension with having bodies was having an experienced enough guy on another drill in spring. We have lots of help at the moment, but 3 of the 4 hired guys just started this last year. Having my neighbour who is retiring wanting to run a drill in spring seals the deal. Adding the acres, means needing a second drill at seeding time. And I couldn’t run both!🤣

[flea beetle]

Instead of bouncing ideas off of the internet, it might be better to have coffee with him and discuss options. You make him sound like a reasonable person and he might come up with a solution that is even better than what you come up with. Also, equipment maybe not even an option and sheds a whole new light on takeover.

Yes I understand his situation dictates the direction that must be taken. And I know it is ultimately up to him to pick that direction. Was just wanting to know if there was a general direction we should be looking in that someone who has been here before could point us in, as this forum is a wealth of knowledge and experience. Maybe save a heartache or two by asking.

[flea beetle]

Are you paying ritchies prices for his equipment?

Prices not talked about at this point. Was just trying to come up with a situation advantageous to both of us.

[flea beetle]

First off, I have farmed for thirty years, and hoped and waited for an opportunity like this. Even a single quarter would here or there, would have been nice. Never came. So good for you!

I wonder if he would be open to the idea of easing out of farming rather than cold Turkey. What I’m thinking is farm his land together. Sounds like he is a grand guy, maybe it would benefit you both and solve some of the machinery issues and manpower issues if you shared his land for a few years?

Less for you to bite off all at once. Give you a chance to work his machinery into your fleet over time.

What an opportunity. Good luck!

Oh believe me, I fully understand and appreciate the opportunity he is presenting me. This is a once, possibly twice in a lifetime chance if you are lucky.

I definitely will run farming together, and slowly easing out, by him. That is an excellent idea, and allows him to tax plan a bit better. And of course it allows me more time to get my ducks in a row. The only downside is he may miss out on the current high priced sale of his equipment.

Thank you for wishing me well.

[LEP]

I have a friend who has bought many many quarters of land vendor financed. Most over 3 to 5 years, many with no interest.

So it isn't always about getting top dollar. There are many reasons for people offering favorable terms.

Think about a scenario that you can realistically make happen and use that as your fall back position.

I think having a conversation and finding out what he has in mind can be quite enlightening and it may surprise you what he is willing to do. Most likely 50 cents of every dollar that he gets for his equipment goes to the government. So he may be willing to trade partial payment on equipment for a reasonable custom rate for a few acres.

It sounds like you have a good opportunity. I think it reflects well on you, that he thinks highly enough of you, to make the offer.

[blackpowder]

Although rare, opportunities do exist.
And this is a big one. Good for you.
Myself, I have my non family partner assume growth shares over time.
I made a vow not to be the guy everyone is waiting on to die before they can do what they want. There will be no checks flipped in my casket before they close the lid. I also wanted to provide earned opportunities I never had. And it's great incentive.
Every business needs new blood.
Most parents have their head in the sand, and most geezers can't see change.
I'm still walking on eggshells around some. It's work not to be bitter.
Run with it.

Just be careful, renting can be for a long time, but never permanent. Get to know his family very well.

[AlbertaFarmer5]

Bison, big acres of crops, selling oats by the tote, rapidly expanding, and occasionally, time to spend on Agriville.

I know there is a lot of truth to the saying, If you need a job done, give it to the busiest person.

I assume the person offering you this opportunity must recognize this too.

I wouldn't turn down the opportunity, if that is the direction you want to go. I've noticed I only seem to regret the opportunities I didn't take.

When you were discussing bison, wasn't part of the reason that you were bearish grains going forward?

[flea beetle]

Bison, big acres of crops, selling oats by the tote, rapidly expanding, and occasionally, time to spend on Agriville.

I know there is a lot of truth to the saying, If you need a job done, give it to the busiest person.

I assume the person offering you this opportunity must recognize this too.

I wouldn't turn down the opportunity, if that is the direction you want to go. I've noticed I only seem to regret the opportunities I didn't take.

When you were discussing bison, wasn't part of the reason that you were bearish grains going forward?

Yes I was, and still am bearish grain going forward. I have a gut feeling we are going to be in tough for a few years once the Ukraine/Russian war is over. (5-10 years) My wife and I had made the decision at the beginning of this crop year to diversify heavily because of this bearishness.

We have started a bison herd. (So far at 63 animals). On the verge of partnering with a reserve and being 25% shareholders in a cattle herd (being involved mostly as their hay and straw provider/consultant). Started a heavy equipment rental outfit (cat/hoe) and picked up a contract to supply equipment for an oilfield reclamation outfit. Started a trucking outfit that hauls equipment for local farmers/a few local ag dealers, also pulls air drills/farm implements, grain/fertilizer in the winter, bales, and also have an older end dump if the opportunity arises. My wife is also on the verge of opening her own accounting firm, and also started doing contract work for a couple other firms, since the kids are almost all in school. So it is definitely busy.

We did all this in the name of diversification, as well as to keep the guys busy in the winter. And then this land falls in a guys lap!

We definitely aren’t big acre farmers. But, I have always been of the mindset that if someone wants you to have something, you will do well with it. And don’t go forcing your way into things. That is when you get in trouble.

Thinking this will allow us to seed more hay, and possibly a little pasture. Will see where it goes. I am having trouble keeping my repeat hay customers supplied the last couple years. Maybe go where the market is?

[AlbertaFarmer5]

Thinking this will allow us to seed more hay, and possibly a little pasture. Will see where it goes. I am having trouble keeping my repeat hay customers supplied the last couple years. Maybe go where the market is?

Easier said than done. We have sold a lot of hay in the past. Not an easy market to chase, or predict. Need to plan 2 years ahead ( at least here, where we underseed to a cover crop), to have hay to sell. by which time, the hay market might not resemble the market when the hay was seeded. For better or worse.



But maybe your crystal ball is less blurry than mine.

[flea beetle]

Easier said than done. We have sold a lot of hay in the past. Not an easy market to chase, or predict. Need to plan 2 years ahead ( at least here, where we underseed to a cover crop), to have hay to sell. by which time, the hay market might not resemble the market when the hay was seeded. For better or worse.



But maybe your crystal ball is less blurry than mine.

Lol we do about 800 acres of hay right now, and between our bison herd growing, and the start of this cattle herd, we could probably use another 300 acres. Also been 1500-2000 bales short the last two years for the repeat customers. I don’t even advertise my hay anymore.

But we are in east central Alberta. Where everyone has plowed under their hay in favour of crop land.

I kind of hinted to my customers this spring that I may get out of selling hay as my bison herd grows, and they practically begged me to keep making and selling the stuff.

[Guest]

Yes I was, and still am bearish grain going forward. I have a gut feeling we are going to be in tough for a few years once the Ukraine/Russian war is over. (5-10 years) My wife and I had made the decision at the beginning of this crop year to diversify heavily because of this bearishness.

We have started a bison herd. (So far at 63 animals). On the verge of partnering with a reserve and being 25% shareholders in a cattle herd (being involved mostly as their hay and straw provider/consultant). Started a heavy equipment rental outfit (cat/hoe) and picked up a contract to supply equipment for an oilfield reclamation outfit. Started a trucking outfit that hauls equipment for local farmers/a few local ag dealers, also pulls air drills/farm implements, grain/fertilizer in the winter, bales, and also have an older end dump if the opportunity arises. My wife is also on the verge of opening her own accounting firm, and also started doing contract work for a couple other firms, since the kids are almost all in school. So it is definitely busy.

We did all this in the name of diversification, as well as to keep the guys busy in the winter. And then this land falls in a guys lap!

We definitely aren’t big acre farmers. But, I have always been of the mindset that if someone wants you to have something, you will do well with it. And don’t go forcing your way into things. That is when you get in trouble.

Thinking this will allow us to seed more hay, and possibly a little pasture. Will see where it goes. I am having trouble keeping my repeat hay customers supplied the last couple years. Maybe go where the market is?

Easy to see why your neighbour picked you !
Sounds like you are part of a rare breed these days !!
Good luck going forward
Most young guys can’t ever imagine the party bring over

[AlbertaFarmer5]

Yes I was, and still am bearish grain going forward. I have a gut feeling we are going to be in tough for a few years once the Ukraine/Russian war is over. (5-10 years) My wife and I had made the decision at the beginning of this crop year to diversify heavily because of this bearishness.

If you are budgeting according to that outlook, and the numbers still work, then you should be in great shape taking on more land.

I start every year assuming the worst. We have been hailed out, drowned out, and frozen or snowed under often enough that I assume a complete write off is a probable outcome. I budget based on historical low commodity prices, regardless of what they are today. And I assume we could go a year or more with no crop income.

[flea beetle]

If you are budgeting according to that outlook, and the numbers still work, then you should be in great shape taking on more land.

I start every year assuming the worst. We have been hailed out, drowned out, and frozen or snowed under often enough that I assume a complete write off is a probable outcome. I budget based on historical low commodity prices, regardless of what they are today. And I assume we could go a year or more with no crop income.

So you aren’t supposed to build budgets based on $20 canola and $13 wheat?😉

[Guest]

i remember , not that long ago , adding water to over dry canola struggling to get to $5.25/bu

[Sodbuster]

So you aren’t supposed to build budgets based on $20 canola and $13 wheat?😉

Not unless you’re trying to justify $150 rent.