Predictions and Observations

[blackpowder]

No debt , don't care. Don't need latest and greatest equipment. Farming to make a living not to impress the neighbors or finance the ag industry. Almost a century farm and it has worked so far, no greed less stress. Merry x-mas to all and to all a good night.

Man, I'm with you.
The thing that eventually affects all commodity production businesses is ever increasing economy of scale.
One can sit still only so long. Seeing that here now finally.

[BTO780]

Long as there is buying prices will NOT drop! Farmers are their worst enemies.

Manufacturers don’t give a rats ass if wheat and canola go down $2-3 bu, long as the orders keep coming in.

How many farmers in the states are able to take off two crops in one yr, or around the world?

The big will always get bigger, they don’t have a limit to where they want to be.

Stealerships and retailers will continue to steal and grain companies will continue to be crooks.
Guess that makes them thieves too.

[TASFarms]

New Kenworths are coming down in price.$30k lower? Big trucking companies aren’t taking all the trucks that they ordered. Probably start seeing that with pick up trucks in the new 6 months. Record amount of Americans behind on auto loans.

[AlbertaFarmer5]

Long as there is buying prices will NOT drop! Farmers are their worst enemies.

Manufacturers don’t give a rats ass if wheat and canola go down $2-3 bu, long as the orders keep coming in.

How many farmers in the states are able to take off two crops in one yr, or around the world?

The big will always get bigger, they don’t have a limit to where they want to be.

Stealerships and retailers will continue to steal and grain companies will continue to be crooks.
Guess that makes them thieves too.

I can't imagine going through life believing that the world is out to get you.
Is there anyone you can trust?

[fjlip]

"No debt , Don't need latest and greatest equipment."

We rarely buy new equipment, and BIGGEST non existent stress is NO debt. Seeing iron prices, we feel the new shed this year was a bargain! For the younger desiring farmers... they MUST risk, we all did. The lucky and careful will do well. Iron was always EXPENSIVE. Land Never paid for itself. Good luck to all, I can coast along after 51 farming years. Sons are well employed, they also rather not borrow $millions$, my legacy is safe.

[makar]

"No debt , Don't need latest and greatest equipment."

We rarely buy new equipment, and BIGGEST non existent stress is NO debt. Seeing iron prices, we feel the new shed this year was a bargain! For the younger desiring farmers... they MUST risk, we all did. The lucky and careful will do well. Iron was always EXPENSIVE. Land Never paid for itself. Good luck to all, I can coast along after 51 farming years. Sons are well employed, they also rather not borrow $millions$, my legacy is safe.

I bought a new grain auger 30 years ago so never say never.

[AlbertaFarmer5]

I bought a new grain auger 30 years ago so never say never.

Coincidentally. I've always said I would never buy new equipment. Then I bought a new grain auger 3 years ago.
Took me quite a few augers to figure this out, but as it turns out, there's no such thing as a good cheap used auger.

[AlbertaFarmer5]

Agree, but depends on the ability of the inheritors to pay the taxes. As well as afford not to cash out.
At $1M per quarter, it's a lot for non farmers to sit on. Only the wealthier will be able to keep it.
Hence the trend in rents to reflect a % of FMV whatever that number may be.
How bad will it be for all when there is no one left willing or able to cash flow that number?
It'll take a different generation to find out. One that, if actively farming, will be rather well heeled.
It seems every acre on earth gets planted somehow regardless of cost structure.

I thought more about this. Perhaps I was wrong when I said the heirs don't sell. Thinking about my most recent purchases.
The last 3 quarters were from estates with multiple heirs, and they couldn't get along so ended up selling the land. One piece had ~30 heirs, that gets messy.
The one before that was an unemployed big shot from the energy industry. He should have quit trying to be a big shot much sooner after the money ran out. It took nearly a year just to get the title, there were so many second mortgages on the land that had to be settled.
Previous to that was a farmer who wanted to sell some land before the prices crashed. That was 11 years ago, he will be right eventually.
I am not aware of any farmer selling their farmland wholesale at arms length in this area in recent times. It either gets passed down, sold piecemeal as they cut back, or sold after they pass on. Last farm I can think of that sold because the farmer quit farming was 1988.

Are there any stats as to how many transactions are arms length vs non arms length?
Very rarely does any land come available publicly, but according to the stats, there are lots of transactions. If I had to guess, maybe 75% of transactions are non arms length? Is that similar elsewhere?

[sumdumguy]

Estate turning over here, with 3 kids inheriting their share of 2 section of gumbo. None of the heirs are farmers - Trudeau is gonna take his pound of flesh when this land changes hands.

[errolanderson]

Inflation now significant decline.

Credit markets reeling. M2 money supply now lowest since 1930s. Fed finally smelling-the-coffee, starting to panic. Media word is pivot. Rate cuts inevitable as economic sirens sound / bank downgrades stateside. Bank of Canada no idea what they are thinking.

Stock market bulls continue their stampede, despite excessive valuations. Bears run over, for now.

Expect pickup in volatility in early ‘24.

[email]errolanderson@substack.com[/email]

[Old Cowzilla]

Around this area anybody inheriting dirt is taking the money and running so just a heads up if you are renting from old people We will soon be like the guys down south of the boarder who chase the hearse looking for opportunities. Land taxes and higher int. rates will likely push more dirt for sale for those who really have no ties to it, cash in a buy a cabin at the lake.

[ajl]

Machinery prices are on the way down now. My new to me, paid for, class 7 combine should arrive this aft. Lots of combine power on the STO. Looked at the machine back in Oct and a month later vendor became negotiable so made an offer on it. Still may have paid above market now. Looking for used tractor as well. Prices still holding at slightly above 5 years ago on those judging by last weeks auction but they are softening as well from where they were a year ago. Locally pump gas is 1.09. Heard of 0.88 in Smokey Lake AB this weekend. Seen land prices drop significantly twice in my lifetime. Once when a teen in the 80's and the other in the 1999-2006 timeframe. Lots of signs of deflation with grain markets in the red. Sold a bit of barley this morning at less than target but don't want the bins full next August. Historic opportunity to buy >6% GIC right now.

[seldomseen]

The only thing I buy new is air tanks.
Looked at lots of used one and they all the same with fertilizer left in them and were really starting to corrode.
Seems farmers are just played right out once planting is done and the tanks don’t get washed to good.

[goalieguy847]

Thats a great point re; air tanks. Bought a used new holland 4580 tank. Great tank... but was definitely corroded a bit much and gave us some silly issues. Also, new augers.. bin full or unload. Other than that we like to let someone.else eat up all the depreciation....

Looking forward to driving an X9 though ( in 7 to 9 yrs).

4wd tractors are absurd. I do see some kijiji guys are still looking for priced for some tractors that they maybe could have got last yr....
175 k ask for a 9400 deere?

Lol not likely mon frere.

[Taiga]

I don’t know why air carts don’t use more stainless. Spreader hoppers have been stainless for years. It wouldn’t be cost prohibitive to use SS. Air carts are way overpriced for what they are right now.