Farm crisis around the corner?

[makar]

Bought a bush 1/4 in 1989 for 18,000, banker told me its not worth it. I agreed but said i got the cat hooked to the brushcutter idling across the fenceline. Had it mostly seeded 2 years later and he never questioned me again.

[makar]

[QUOTE= I can even remember the day the drought broke. April 27, 1991. Remember 1991 quite well. Couldnt combine or seed 2 years previous due to monsoons.

[AlbertaFarmer5]

Bought a bush 1/4 in 1989 for 18,000, banker told me its not worth it. I agreed but said i got the cat hooked to the brushcutter idling across the fenceline. Had it mostly seeded 2 years later and he never questioned me again.

Do those opportunities still exist up there?

I toured around the Valleyview are and further north at least 20 years ago, and at that time there were a lot of bush quarters, and land growing back to bush, or weeds. Have they all been put back into production since then?

[makar]

Do those opportunities still exist up there?

I toured around the Valleyview are and further north at least 20 years ago, and at that time there were a lot of bush quarters, and land growing back to bush, or weeds. Have they all been put back into production since then?

No, the rich urbanites pay for bush to camp out to drink whiskey with their buddies so they can all tell the wives they are hunting.

[newguy]

Bought a bush 1/4 in 1989 for 18,000, banker told me its not worth it. I agreed but said i got the cat hooked to the brushcutter idling across the fenceline. Had it mostly seeded 2 years later and he never questioned me again.

Bought a quarter around that time for 18 grand also.Banker told me it does not pencil out if it was free.Even when the drought broke here input money was hard to get.And you bought inputs in advance and never received full payment of your crop for 2 years after inputs were purchaced.because the way
the CWB payments worked.

[GALAXIE500]

Those that got crops and farmed with money and not for money never knew what the tough 80s were about.Your area never had grasshoppers eating evergreens and paint on the houses.

I remember those conditions from the 80's over here in SW Sask. poor crops , wind , thistles, kochia , and then it would rain a bit but always wind after that. The last three years have been mostly similar.

[Crestliner]

Well its almost December 2023. Let's do a recap using 2023 crop production numbers and current market prices on just canola and wheat (the big acres).

"Where did all the Farm Income go since the 2021/22 price run-up"?

Wheat:

2022- 34.7 mmt x $433 = $15 Bill
2024- 37.0 mmt x $332 = $12 Bill

Missing $3 Billion

Canola:

2022- 21 mmt x $812 = $17 Bill
2023- 17.4mmt x $662 = $11.5 Bill

Missing $5.5 Billion

Interest on Farm Debt:

2022-138 Billion x 4.7% = $6.4Bill
2023-150 Billion x 7.2% = $10.8 Bill

Added(Missing) $4.4 Billion

Inputs: I left them unchanged for the moment.

I know this is just a rough calculation...but there is about $13 Billion missing from the farm economy since the last 12 months...

The question is, is this having negative impact yet?

[furrowtickler]

Well its almost December 2023. Let's do a recap using 2023 crop production numbers and current market prices on just canola and wheat (the big acres).

"Where did all the Farm Income go since the 2021/22 price run-up"?

Wheat:

2022- 34.7 mmt x $433 = $15 Bill
2024- 37.0 mmt x $332 = $12 Bill

Missing $3 Billion

Canola:

2022- 21 mmt x $812 = $17 Bill
2023- 17.4mmt x $662 = $11.5 Bill

Missing $5.5 Billion

Interest on Farm Debt:

2022-138 Billion x 4.7% = $6.4Bill
2023-150 Billion x 7.2% = $10.8 Bill

Added(Missing) $4.4 Billion

Inputs: I left them unchanged for the moment.

I know this is just a rough calculation...but there is about $13 Billion missing from the farm economy since the last 12 months...

The question is, is this having negative impact yet?

Absolutely, but not everywhere.
20% of western Canada had a good crop again . Most of them still flush with money after 3 good years .
it’s the 80% that have had below average to poor crops from the last 2/3 years to 5/5 years .
add that to the numbers you shared and there is a train derailment happening in many areas not being talked about .
crop insurance coverage levels will be way down on everything but lentils in 2024 most likely and for some premiums will be higher in the worst effected areas .
things can change in the next 6 months but right now with these crop prices and billions off the table for everyone , with very bleak moisture reserves in most areas , definitely a negative effect outside the few golden zones is happening.
2024 will be a very pivotal year for a huge majority, and for the industry as a whole .
Auctions still show some life , but that’s only because new has gone ballistic in price and supply is still very low .

[Guest]

Not around here , she’s wide open in the swamp

[Old Cowzilla]

The guys with cows will be getting more attention when they go to town these days maybe even a warm welcome at the dealerships

[SASKFARMER]

It's not going to be like the 1980s because we were fighting the USA Treasury plus Europe with heavy subsidies and Ottawa said to farmers you're on your own.

Interest was 20% nothing worked.

No investors that's the big one.

Till the investor has no one to rent the land it has only one way to go up up and away.

Every week another farm is listed for sale and every week it sells. Last week 14.9 million for one gone in days and this week $12.9 on the east side.

[blackpowder]

Farmer buying still the majority.
Investors set the floor?
Cherry pick when price below perceived value?
I'm wondering what the investor's plan is if prices can no longer support 2.5-3% of FMV rents.
When appreciation stalls?
Who are they really, and what's their long term plan. I don't think they are Bay Street speculators this time.
Investor interest just showing up here now.
Some pools of money seem quite deep.
Some are farming it themselves on paper at least.
Economies of scale and stable returns even if miniscule?
Since I was born land here has gone from $50 to $100 to $1000, back to $700 for 20 years, and now $6000 in the last 20.
Farming itself has changed and we're no longer isolated here in western Canada.
A 10 year downturn will look small in the rear view for those left in the game.

[sumdumguy]

Just heard $180 cash rent offers around here. hmmm

[fjlip]

Yes a wide variety of returns/acre. Very aggressive young guns in our area. $3000/acre, $125 cash rent. NEW iron all over.

Dealerships all sold out for 2024. Must be optimism, $$$ from last 3 years. No poor crops here, bins bags all full. Check in a year, might be reality check, it's fricking DRY so far!

Made a trip from Estevan to Wadena....not great crop stubble left in majority of fields.

[Rareearth]

So…
If China has come in and bought 1/2 the durum crop with out any one knowing…

Who can guarantee China hasn’t bought 1/2 the canola crop? ….

Come on man, ( Monday night foot ball) there is a good reason for export sales reporting system. We leave a lot of dollars on the table ( exporters, farmers, provincial and national GDP)…