Is it hard to quantify these costs? Are these inputs reasonably predictable year-in, year-out?
Australia's Cheapest Farmland?
- Thread starter meconium
- Start date
Is it hard to quantify these costs? Are these inputs reasonably predictable year-in, year-out?
My grandfather did this in the fifties with his wool cheque. He upsized his farm by about 40 % and paid for it in the first year but was income from his other 60% aswell.
From topcropper
I recently bought an acre which is .4etc of a hectare 25 mins out of Byron for $280,000 and think I got a bargain. I'm hoping to turn it into a permaculture paradise but I'll have my work cut out for me. The block is elevated so very steep but the rural views are to die for. I've chosen it because of the rainfall and the proximity to major centres like the Gold Coast. I wish I had more of the pioneering spirit that our older generations had to move out even further. I may have got a much cheaper option.
Anyway, for my 2 cents worth, I think farmland will become less available and skyrocket in price in years to come.
Cheers
I recently bought an acre which is .4etc of a hectare 25 mins out of Byron for $280,000 and think I got a bargain. I'm hoping to turn it into a permaculture paradise but I'll have my work cut out for me. The block is elevated so very steep but the rural views are to die for. I've chosen it because of the rainfall and the proximity to major centres like the Gold Coast. I wish I had more of the pioneering spirit that our older generations had to move out even further. I may have got a much cheaper option.
Anyway, for my 2 cents worth, I think farmland will become less available and skyrocket in price in years to come.
Cheers
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Well, I love farming, I love farming communities, I love the land fullstop, but wanting to own farmland and derive income from it is...complex.
The Warracknabeal farm, generally speaking is quality farmland, BUT within the areas of quality farms/soils are pockets of notsogood soils. Most of the farmers like to have their land balanced out, a bit of the sandier, loam types, and then some heavier country. (Around these parts...meaning wimmera mallee area).
But it's the operator that comes into play that makes a difference too.
Farming is a business. It has input costs and yields like any other business, mindset is important, a sense of adaptability, lateral thinking, a preparedness not to just necessarily do it this way because that is how it's been done for 50 years...
Topcropper's farming is light years away from the farming that is done here, farmers would need to learn an awful lot to go farm up in TC's interstate area, what is done here is not necessarily the best way to farm the sandier soil north of us, (eg millewa), and it is very different to how farming is done south of us, (western districts)...it is complex... and I'm never quite sure if people ever realise the complexity of it all? Just saying, that's all. There is far more to farming than being able to get your hands on cheap land to work. You may know all this, you may well be off farming land, but doesn't hurt to just go back over some basics.
There would be considerable farms prepared to sell up as walk in walk out basis if you made fair and reasonable offers, the places not necessarily on the market, but prepared to sell at the '*right' price.
*subjective?
Cheap farmland is not cheap if you are not able to work it to utilise it's capabilities and gain possible returns you can, just like expensive farmland ...we have just seen one of the southerner farmers sell up to a farming corporation because he is 'sick' of this farming area, he is trying to work it like he does land 4 hours south of us, he lasted 8 years. Admittedly he bought it at a time of an extensive and severed drought, but the farmers utilising direct drill technique grew magnificient crops, multi million dollar crops of almost exactly the same soil types the southern farmer was continuing to farm via the fallowing technique...
If someone was desperately interested enough in farming I respectfully reccommend they get around as many of the farming areas they can to see and learn as much as they can about farming in general for one, but also the 'area' that they might be considering buying farmland in. Even by doing that it's apples and oranges the way this farmer here 10 k's up the road is still successful even in droughts, while the other one is on their last gasp.
It's really complex. There are plenty of farms around, the Weekly Times has a good presented selection in middle of it's paper, the elders sites, and other specific agricultural sites, landmark, verncastlerealestate.com.au is a smaller operator seller agent that has been around a long time, (pointing him out as an 'example' of some lessor publicised agents around the traps), and other internet sites, again:http://www.weeklytimesnow.com.au/property/index.html
There are many more..
our obsession, i love your saying down the bottom of your posts. I have currently got scratch marks on both shins from walking around in the dark. I put this down to having kids and them moving stuff around all the time.
We are farming and yes it is a tough game. As you say you have to adapt and change to stay profitable.
One of the ways we earn some extra money from farming is through solar panels. Our solar earns us over $550,000 a hectare per year which is not bad considering the average farm probably earns $0 to $300 a hectare. Trouble is we have only got one one hundred and twentieth of a hectare of it.
We are farming and yes it is a tough game. As you say you have to adapt and change to stay profitable.
One of the ways we earn some extra money from farming is through solar panels. Our solar earns us over $550,000 a hectare per year which is not bad considering the average farm probably earns $0 to $300 a hectare. Trouble is we have only got one one hundred and twentieth of a hectare of it.
The actual imputs that are used is reasonably predictable and the cost of most of these is somewhat fixed, eg: machinery, labour, seed. Fuel, fertiliser and chemical prices can vary from year to year but generally do so with the grain prices.
My granddad has a similar story. Following WW2, his application for a soldier settlement farm was rejected as he had been farming leased land and was deemed able to settle without assistance. He was renting his fathers farm among aothers that were all being acquired for the soldier settler scheme. In 1950 wiith nowhere to go he put everthing on the line and bought 950 acres of very rough land covered in dead timber. He really made a go of it running sheep, cattle and growing crops. With the wool boom and good seasons he paid for the place in three years.
The most important point. The return on capital will vary just as much in one area (same soil & climate, different farmers) as it does across the country. The difference is the management. Say you have two farms each with $1 million invested in machinery. Farm A produces $700,000 worth of crop and farm B produces $1.4 million. This happens all the time for many different reasons. I guess it is the same in any business.
our obsession, i love your saying down the bottom of your posts. I have currently got scratch marks on both shins from walking around in the dark. I put this down to having kids and them moving stuff around all the time.
Ah, this is where my hockey shin-guards come in handy, now where did I put them....?
We are farming and yes it is a tough game. As you say you have to adapt and change to stay profitable.
One of the ways we earn some extra money from farming is through solar panels. Our solar earns us over $550,000 a hectare per year which is not bad considering the average farm probably earns $0 to $300 a hectare. Trouble is we have only got one one hundred and twentieth of a hectare of it.
Hmm, nice, I hope opportunity arises to capitalise on that more. Victoria has begun paying? instead of crediting, my friend who is 'self sufficient' in one of the regional cities here, (for both his water and power) is paid up to several thousands dollars a year for what he has go back into the grid. He is my guinea pig for all things operational self sufficient, my aim for notso distant future...
Just heard back from Bill the agent on that property. He said average rainfall 15 inches and average yield for wheat 14 bags to the acre. Knock a couple of bags to the acre off for exageration and you are looking at 2.5 tonnes to the hectare country. Well short of the 4 tonnes a hectare I would rate as productive country. Topcropper would probably be dissappointed if he didn't get 6 tonnes to the hectare and then he can turn around and jam another crop in for the summer.
Agent did say however that it was 95% arable. Soils can differ a lot over one property aswell though and there would probably be no doubt that the area not mentioned in the ad would be poorer soils.
It is amazing though for what you can get for that price with a house on it when you say compare it with a two bed apartment close into Melbourne.
I agree completely. The further out the better as far as wealth creation. But of course, the further out the tougher the lifestyle. Risk/Reward, exactly.
See ya's.
It would have happened heaps in the past.
In the past there was lots of opportunities arise where land was way undervalued. In my area it was in the 60's when the deep flat black soils were thought to be not able to grow crops and were terrible for running stock. There was no trees for shade in the summer for the sheep and cattle, and in a wet winter the land became a boghole. It was covered in useless native grass that grew 8 foot high and was almost unpalatable, or thistles 10 feet high. Then herbicides came out, and big tractors and chisel ploughs to plough up the ground without getting blocked every 30 seconds, and suddenly everyone who owned this land became very wealthy. Unbelievably, my grandfather was left the poor plains dirt, as he was the youngest. His two older brothers were left the ridge country. None of my cousins are still on the land, but we are thriving. It was just luck.
This year it could have happened in marginal areas growing wheat with very cheap land thanks to a once in a lifetime perfect wet growing season and great prices for prime quality wheat. But the wet harvest buggered that chance up.
In northern NSW this year there will be a few lucky chaps who hit the jackpot with dryland cotton. They will need to have not forward sold, and have missed the floods. Dryland black dirt around Bellata, and through to North Star and even south to Narrabri and Gunnedah, sells for about $3000 to $4000 a hectare.
It's possible that some dryland cotton could yield 6 bales per hectare in a wet summer like we have had. Cotton is currently worth $700 a bale or more. 6 bales times $700 equals $4,200 gross.
Cotton is fairly cheap and reliable to grow these days now that it's genetically modified. It's bug resistant and you spray it with roundup for weeds. Once you pay monsanto the royalties for the seed and the right to grow it I can see some of the better operators making $3,000 per hectare profit this year on land worth not much more.
It's just a one off though. Record cotton prices, missed the floods but just the right amount of rain, not forward sold the crop. The sort of thing you wait a lifetime to get. Some farmers will get that this year from dryland cotton just north of me.
See ya's.
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If you keep this up topcropper, we're ALL a long time dead. Try thinking about future generations and what they are going to inherit. Do your research on Monsanto and GM crops. Unfortunately I don't have a lot of time on my hands at the moment, working two jobs, but I will keep an eye on this thread and try to post more about this subject.
cheers
If you keep this up topcropper, we're ALL a long time dead. Try thinking about future generations and what they are going to inherit. Do your research on Monsanto and GM crops. Unfortunately I don't have a lot of time on my hands at the moment, working two jobs, but I will keep an eye on this thread and try to post more about this subject.
cheers
Why don't you instead start a new thread. I'd join in, in a discussion about GM crops.
For the record, I'd love to see GM crops banned. GM crops increase production from land, increase the supply of food, and means lower food costs for consumers and prices for farmers.
See ya's.
Same here topcropper. Topcropper how is this for an idea. Every farmer in the world to cut their fertiliser use altogether. This halves production say. What would happen to the price of soft commodities. Would go up 5 times at least I would reckon.
Then everyone would complain what about all the starving people in the world. The way to fix that is farmers keep back half of their production and send it to the starving people for free. This means there is only one quarter left to sell on the market. Now what is the price?? More than 10, 15, 20 times where it is now.
Probably cause a few wars and the end of the world I would say.
In summary there are three types of cheap farmland.
1) reliable land that has a regular low return but high capital gain, need to stay in this for the long run.
2) marginal land that on average has a huge return, high risk = high reward.
3) speculation:
If you can change the use of land then the short term increase in value can be tremendous. Alternatively a sudden lift in crop yields or stocking rate by changing the production system can have the same effect. To buy cheap land with this in mind is speculation, but it is no differnt to buying a house in a town where a new industry might spring up. I know an engineer who bought a house to live in every time he got a new job. When he was employed that was a sure sign that the proposed power station, mine, etc was actually going ahead. He has made huge money every time he moved as his houses have appreciated incredibally with each new industry.
1) reliable land that has a regular low return but high capital gain, need to stay in this for the long run.
2) marginal land that on average has a huge return, high risk = high reward.
3) speculation:
If you can change the use of land then the short term increase in value can be tremendous. Alternatively a sudden lift in crop yields or stocking rate by changing the production system can have the same effect. To buy cheap land with this in mind is speculation, but it is no differnt to buying a house in a town where a new industry might spring up. I know an engineer who bought a house to live in every time he got a new job. When he was employed that was a sure sign that the proposed power station, mine, etc was actually going ahead. He has made huge money every time he moved as his houses have appreciated incredibally with each new industry.
Halve the production of food and it would go up 20 times in price.
Probably. Look whats happening in Egypt over food prices rising by just a bit.
See ya's.
from topcropper
Thank you for the invitation. I would love to start thread on this topic. Any suggestions for which discussion group it would best suit? Coffee Lounge may be a bit too lightweight for such a serious subject.
Some of you have weighed in on the food shortages and skyrocketing prices angle. Definitely a huge concern but I very much doubt that Monsanto GM crops will solve this problem. We need to support the smaller farmers and locally grown food, something that Monsanto has a record of NOT doing. Read this article:
http://www.vanityfair.com/politics/features/2008/05/monsanto200805
Cheers
Thank you for the invitation. I would love to start thread on this topic. Any suggestions for which discussion group it would best suit? Coffee Lounge may be a bit too lightweight for such a serious subject.
Some of you have weighed in on the food shortages and skyrocketing prices angle. Definitely a huge concern but I very much doubt that Monsanto GM crops will solve this problem. We need to support the smaller farmers and locally grown food, something that Monsanto has a record of NOT doing. Read this article:
http://www.vanityfair.com/politics/features/2008/05/monsanto200805
Cheers
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