Do's and Dont's Advice

[smstonypoint]

How is the Renter Farmer making money?

Chances are he is farming a heck of a lot more than 50 acres.

Steve

 

[Newtothis1]

Chances are he is farming a heck of a lot more than 50 acres.

Steve

Yes he is, it just seemed possible to make some money with all of my equipment 100% paid for. He's finding a way to do it large scale, tending many thousands of acres and paying millions of dollars on new equipment every year

 

[smstonypoint]

Yes he is, it just seemed possible to make some money with all of my equipment 100% paid for. He's finding a way to do it large scale, tending many thousands of acres and paying millions of dollars on new equipment every year

Are you renting to Justice Family Farms?

BTW, I just checked -- NC new crop soybean contracts ranged from $10.53-11.24/bushel today (http://www.ams.usda.gov/mnreports/ra_gr110.txt).

Steve

 

[smstonypoint]

Actually, your realized net gain is only $4,537.50 since you receive $4,000 for doing nothing. Lotta work for $4,500.

I have my doubts about the $4,537.50, but you hit the nail on the head in saying that the rent forgone is an an opportunity cost of growing soybeans or any other crop.

Steve

 

[dave1949]

I can understand the urge to get your hands in the dirt and maybe make some money. If your main issue is that you think you aren't getting enough return on the land, there are examples to look at involving specialty markets. Seems like limiting yourself to big market commodities like corn, beans, etc., is like tying one hand behind your back.

As far as I know, farms break even or lose money some years, do better in others. The size of the acreage wouldn't change that expectation since it is caused by the market and weather--two things beyond your control. Are you prepared to live with the bad years while thinking dang, I could have had $4000? If you experience a really bad year and two so-so break even years back to back, it will be three years with no net farm income at all.

 

[Newtothis1]

I can understand the urge to get your hands in the dirt and maybe make some money. If your main issue is that you think you aren't getting enough return on the land, there are examples to look at involving specialty markets. Seems like limiting yourself to big market commodities like corn, beans, etc., is like tying one hand behind your back.

As far as I know, farms break even or lose money some years, do better in others. The size of the acreage wouldn't change that expectation since it is caused by the market and weather--two things beyond your control. Are you prepared to live with the bad years while thinking dang, I could have had $4000? If you experience a really bad year and two so-so break even years back to back, it will be three years with no net farm income at all.

I can appreciate all the comments. Yes, I am anxious to do something with my own land but its starting to sound like I should just leave well enough alone or maybe plant it all in pine trees since I'm only 30 yrs old

 

[paulharvey]

Pine trees aren't as good as once. In North Florida I've noticed several tracks of pines cut for pull being replaced with blue berries. Wood demand is slow with decreased construction demand.

 

[dave1949]

I can appreciate all the comments. Yes, I am anxious to do something with my own land but its starting to sound like I should just leave well enough alone or maybe plant it all in pine trees since I'm only 30 yrs old

Well heck, you are young man with plenty of time ahead of you to develop a niche market product if you plan on staying put. I assume the greater Raleigh area will see significant population growth over the next several decades? If so, you have an expanding market opportunity. There seems to be a steady market for quality products in areas with the income to support it.

 

[TripleR]

I know all I am doing is trying to plug in numbers for a baseline and hoping for some positive feedback telling me what I wanted to hear. You are correct that my lack of experience gives me no concept of the costs and risks involved. Your opinion kind of sounds like the others.....to stay away from it. I have to trust what experienced farmers tell me and i appreciate you telling it like it is. I hate that it sounds like I have to settle for $80 an acre rent money

I would check to see what others are getting for cash rent, it is $125 at the low end up to $200 or more. Mom does a crop share, but I want a set yearly amount, I "gambled" on crop yield enough years already.

Trust me, I sure understand your desire to farm the land, we kept our no till planter until selling it last; man hated to let that thing go.

 

[toomanymachines]

I wont have to deal with driers or grain storage with this small amount. i should be able to pick at correct moisture content and haul strait to the grain buyer(only 10 miles away). I guess what I cant wrap my mind around is that an acre cost x amount of dollars to plant and harvest, and profits x amount of dollars, no matter how many or how few the acres. People are telling me due to our long growing season I can turn two crop cycles per year and should be able to clear about $800.00 per acre. Does this sound very far fetched?

Eight hundred dollars an acre sounds very high. If that was true farmers would only need 100 acres to survive. I think 100 dollars clear may be a better number.
One thing that will help, is that you will be able to write off all the expenses. Whenever you travel to town for groceries, just make sure you pick up a bearing.. fuel is written off..
like others have mentioned, if you think others will come and do custom work, well maybe, but you would be low priority with only 50 acres. Why would they move for that if they can do 160 acres for someone else.
It is nice to be your own boss.