“Not all dirt is the same. Some dirt is astonishing, compared to other dirt,” – Jim Rogers 01/10/2012
“If I were buying anything I’d be buying agricultural commodities,” “Going forward we’re going to have huge shortages of everything – including farmers – I think ag will be a great place for the next 10-20 years” – Jim Rogers 12/30/2011
Analysis has revealed that with a buy date of December 6 and a sell date of June 13, investors have benefited from a total return of 95.14% over the last 10 years. This scenario has shown positive results in 6 of those periods. – by Don Vialoux of EquityClock.com
Sioux County, Iowa: Ground zero for U.S. farm boom. While farmland prices across the Corn Belt in Iowa have been among the heartland’s fastest growing – up 261 percent since 2000 – they’ve more than tripled in Sioux County, rising faster than most of the state.
That story is about a speculative boom in prices.
” More simply put: It would take the Kaster family more than half a generation to recoup their money – and that’s only if corn prices remain relatively high.”
The problem is when speculators like Rogers buy tracts of land on speculation, because they can afford to do so. That removes the “real” farmers from the possibility of buying land.
This is happening in SWOntario, where the bigger farmers are more like real estate speculators. They’re just buying land using other highly leveraged land (with its inflated value) as collateral.
This year the US will use more corn for fuel than food. This will drive the cost of corn even higher. Witch will drive the cost of all food still higher. This will also help to raise the price land.
It’s SOIL….not dirt.
Those city writers, sheesh.
As a farmer the spooky part is over 40 percent of US corn is now in ethanol. If they get in serious financial trouble that subsidy has to go,as it should. That leaves 40 percent of the crop with no home which would hammer prices down. False demand is never good.
Can you say bubble?
http://www.detroitnews.com/article/20111224/AUTO01/112240320/Congress-ends-corn-ethanol-subsidy?odyssey=mod|newswell|text|FRONTPAGE|s
I knew you could…
Farmpunk:
You don’t need to own land to farm it. Rent it.
High land prices and speculator interest helps current farmers retire with more wealth and that’s a very good thing.
I would be buying options and covering my backside on Jim Rogers predictions.
In this area the price of land is between $1500 and $2000 an acre.
Gord Tulk, exactly. When I started farming in this area 38 years ago, I was told that the price of an average quarter of land was about the same as the price of a good 3 bedroom house. Well in order for that corollary to hold true today a quarter of land should be priced at between $300,000 and $350,000 thousand.
Ken (Kulak): I think your corollary is still in the ballpark. At $1500/acre a Regina plains quarter section is $240k. A Solid 3 bedroom bungalow in a small town 30 minutes from Regina is in the $180-250K range.
We’re out visiting family about 60 miles NE of Regina this summer. Cousin is farming about 9000 acres using 4 tractors and 3 combines.
– happy about the CWB demise
– unhappy about Calgarians coming out and buying up farmland for their dacas in the country. Increases farm prices, the farms are leased because of absentee owners.
– Local native band receives government money to buy farmland, thusly boosting farmland costs. The native farm periodically goes broke and gets refinanced by more government money.
You’re on the money with that call. Ag futures will be as hot as gold shortly.
But is isn’t just a coincidental phenomenon. It is the collateral damage of aggressive sustainability planning – the destruction of the small family farm through over regulation, taxation, commodity marketing manipulation and debt in favor of corporate farming. Then there are the trends of diverting food production to bio-fuel and letting marginal crop land go fallow in sustainability taxing incentives – taking all that diverse independent production out of gross ag sales will create shortages and inflate prices.
We will experience big price increases here but in the 3rd world dependant on our excess production to sustain local food demand, it will be devastating. Another costly/deadly FUBAR brought to you by the central planning committees for agenda 21 sustainability – who are busy this moment gnawing away at land use and resource allocation in your own back yard this very moment.
For those looking to make their fortune in farming this video will give you all the info you need:
http://www.youtube.com/watch?v=_pDTiFkXgEE
Too bad so many short-sighted farmers sold their land to Hutterite communes. Warner County in SW Alberta is 60% Hutterite owned. These communists are very close to having this market cornered, in AB. That means they have a great influence on equipment prices, and can put small local businesses out of business. I won’t even get started on the way they abuse the environment.
Yeah, that Agenda 21 is still on a roll.
It is nothing more than a elitist blueprint to enslave the world….the AGW scam is it’s cutting edge..
One aspect of farming many overlook….somehow land ownership must be disconnected from farming. Farming historically has struggled to service land costs.
Rurbanites here in Ontariario, have remedied this to an extent. Urban real estate prices, make a country estate more attractive….and that estate is a potential income property to them…making farmland more reasonable in cost….generally it is cheaper to lease/rent land than to own it.
The downside is the farmer has to surrender security of his land-base….some operators have suddenly been short of ground. Suddenly having only 200 acres and the equipment to farm 4000.
Then there are instances where the landlord imposes conditions….use of chemicals…hours of operation….
Saskatchewan will never amount to anything. Even in the the present “boom” there are more drilling rigs laying down in AB than there are working in SK.
461 rigs working in AB
99 in SK
And that’s with a “friendly” gov’t in power. The threat of 70 years of unfriendly gov’t is never far away in SK. Add in third world roads, and a third world attitude…
This year the US will use more corn for fuel than food.
Not likely. Without the biofuels subsidy which the US just cut, corn ethanol isn’t profitable since it takes more energy to make ethanol from corn than is in the ethanol produced. It’s nothing more than a scam to subsidize multinational industrial agriculture companies.
US law says they must add ethanol no matter the cost. It is stated by the USDA that they will use more corn this year because they are forced by law.
Y’all are assuming the futures MARKETS don’t collapse. I suggest y’all check out the December 30, 2011 “Cascading Risk” post at http://barnhardt.biz/
You can make up your own minds as to how accurate her take is, but it’s worth considering.
Yeah, all owned “on paper”, but the paper is no damn good because the rule of law has been perverted.
The old saying, a bird in the hand is worth two in the bush…
Hey fiddle diddle, those 99 Saskatchewan rigs are doing somethig a little different than the 400 Alberta rigs- drilling productive wells. Our conventional oil output is nearly equal that of Alberta, and we have just got started punching holes here.
A case of sour grapes maybe, fiddle?
I almost forgot – we also have half the worlds potash reserves, uranium, gold, diamonds, and a much larger agriculture industry than Alberta.
The attitude here is fantastic. And evidently better than certain Albertans’ attitudes.
Hey fiddle diddle, those 99 Saskatchewan rigs are doing somethig a little different than the 400 Alberta rigs- drilling productive wells.
Yeah, that’s why there are only 99 rigs. And only a million people.
Larger agriculture than Alberta? Don’t think so. Where’s the beef?
http://www.bdo.ca/library/publications/agriculture/documents/Agriculture-Outlook-2011.pdf
Province—2007——2008——-2009
Nfld——-106.5——109.9—–109.6
PEI——–382.6——392.3—–395.7
Nova Sc—-456.8——477.5—–441.6
New Br—–450.4——472.1—–482.6
Quebec—6,877.5—-7,502.9—7,371.6
Ontario—9,324.1—10,099.7—9,650.7
Manitoba-4,338.9—-4,789.2—4,763.4
Sask—–7,752.9—-9,392.4—9,197.3
Alberta–8,664.1—10,157.5—9,339.1
B C——2,391.6—-2,494.5—2,421.6
Canada–40,745.5—45,888.0–44,173.1
To Ryan at 10:37. I like your attitude. I’m an Albertan. Saskatchewan has huge potential. The only things I see that could hold it back are a return to represive government or a lack of labor. As long as there are enough people with your attitude your province will do well. In Alberta, we need a change of government. The So called conservative party here has become exactly like your old NDP. If we don’t have a change next spring we are in trouble. Cheers