How do farmers make any money?

[Jstpssng]

Yes… answer was wrong forum with link to the Deere forum…

That's understandable. Kubota owners don't have problems so we wouldn't have any helpful information.

 

[edgarrian]

I'll bet those same farmers didn't want their view spoiled by those subdivisions.

Those farmers are selling their land for subdivisions. Dont forget that

 

[quicksandfarmer]

It happens and depending on how much time one is in the swamp eventually everything is seen from the swamp perspective.

I posted a Deere question in the Kubota forum before by mistake…

Number 1 to making money farming or ranching is access to land that makes it possible…

My farmer grandparents said the land is everything… to be cherished and passed down generation to generation.

Joel Salatin's name has come up in this thread, he's written a lot of books about farming.

A critic once said Salatin's technique for farming is simple:
Step 1: Inherit several hundred acres of prime farmland

 

[ultrarunner]

Parlay your advantage and build from that…

 

[Flogger]

The healthiest farms I know operate without a mortgage. If you are borrowing money to operate every year is a huge gamble.

 

[Jstpssng]

The healthiest farms I know operate without a mortgage. If you are borrowing money to operate every year is a huge gamble.

You can say that about any business, though.

 

[Hay Dude]

Joel Salatin's name has come up in this thread, he's written a lot of books about farming.

A critic once said Salatin's technique for farming is simple:
Step 1: Inherit several hundred acres of prime farmland

Or better yet, farm other people’s land rent free.
No taxes to pay, no property upkeep, no worries about trespassers, vandalism, etc.

 

[Hay Dude]

The healthiest farms I know operate without a mortgage. If you are borrowing money to operate every year is a huge gamble.

Maybe there’s some farms operate without a mortgage (mine does), but they likely borrow money for equipment (mine does).

Some do both.

Borrowing money is OK as long as your gross profit and hopefully your income is increasing every year. I had a banker tell me they would not be interested in lending money unless they see an increase in gross profit every year.

 

[ultrarunner]

Had a chance to talk with a manager at a multiple location tractor franchise and he said at harvest time a lot of the new equipment you see is leased short term…

It gets the equipment out the door, has full warranty, presents certain tax advantages and dealer is able to sell harvest returns at a discount with factory warranty and service history…

Before, it never occurred to me farmers would lease short term and I had thought they own with a payment book.

 

[Hay Dude]

Had a chance to talk with a manager at a multiple location tractor franchise and he said at harvest time a lot of the new equipment you see is leased short term…

It gets the equipment out the door, has full warranty, presents certain tax advantages and dealer is able to sell harvest returns at a discount with factory warranty and service history…

Before, it never occurred to me farmers would lease short term and I had thought they own with a payment book.

Leasing is very popular now. Seems like the last step left for affordability of new equipment for farmers. Buying outright is a luxury for huge corporate farms with tens of thousands of acres. Financing can be done, but interest rates along with current prices, are extremely high. It’s nothing for a new 300-400HP tractor to cost $4,000/month. Then there’s the other 12 pieces of equipment and 3 other tractors needed……
Generally, You need to farm 10,000+ acres to afford anything new. And bigger acreage means bigger equipment.
I felt lucky when I found this 300HP tractor with 9K hours and a rebuilt engine and new CVT for $75K. Big farmers would think this tractor is a POS lol. The baler behind it is a 2014 with 25,000 bales through it. Needs regular and expensive repairs to keep it going.

The tractor was also used to plow roads. I bought it without the plowing equipment to save 10K.
I see a lot of smaller farmers in my area are now plowing snow, logging, and doing large area mowing to make a few extra sheckles because farming is becoming more & more expensive every year. I’ve been doing that for years, too.

I still enjoy what I do and despite the expense, I’m able to show a decent profit