10-26-2012 08:19 AM - edited 10-26-2012 09:10 AM
Just remembered -- saw this report yesterday and am doing a little digging to find out more this morning. Latest land sale up in NW IA ended up with the land selling for just shy of $22K/acre. So, is the seller getting away with murder, or will it cash-flow?
Here's a brief on it. I'd love to hear if anybody has any knowledge of the situation or feelings about it otherwise!
Meanwhile, don't look now, but the grains are crawling out of the gutter this morning...maybe. December corn's now in the black, 2 cents higher at $7.44/bushel, and Dec. wheat's 3 cents higher at $8.75 3/4. November beans are still in the red, though, at 3 3/4/bushel. Are we on the way to a higher market to end the week?
A couple of other factors rattling around this morning, one trader tells me:
Well, Marketeye's out today; these markets the last few days have made him sick! Well, that and having a couple of little kicking, screaming petri dishes (his twin boys)! But, he's on the mend...unfortunately, that means you're stuck with the B-Team today.
Sounds like things got pretty ugly early in the overnight trade, then eased a little as tight supply worries started creeping up in folks' minds. Early calls are 2-4 lower for soybeans, 1-3 lower for corn and 1-3 higher for wheat.
At 7:39 AM CST, December corn was 1/4 cent lower at $7.41 3/4 per bushel, while November soybeans were 4 3/4 lower at $15.61 1/4 and December wheat was 1 cent higher at $8.73 3/4.
So, what else is going on this morning? A little frost on the pumpkins at everybody's place this morning?
10-26-2012 02:46 PM
SNOW! We got about .3 inches of rain, with about 6 inches of snow on top of it, yesterday morning. While it is far from breaking the drought, at least the clouds are showing us that they remember what they are supposed to do. Also, quite cold for this time of year, 25 to 30 degrees below normal for the daytime highs, and 10-15 below normal for the night time lows.
Last week, we had a big wind that blew a lot of corn over, what didn't get picked, then got 3-6 inches of snow on top of that. Not looking pretty. I have talked to a couple people hoping for a return to a dry spell, so they can try to bale the cornstalks with all the down corn in it. Their theory is, if they can rake it all together, enough ears of corn will pull in with the stalks, to make for good cattle feed. Some think it will work better than letting the cattle graze, others wonder if running 12% moisture ears of corn through a rake, and then baler, won't cause more headaches with volunteer corn next year, because of shelling, rather than letting the cows pick up the ears. I guess springtime will tell.
Does anyone know, how to get rid of volunteer corn, in a no-till or minimum till field, that is to be planted back to corn? It is all RR and some is RR/Liberty corn. I'm just curious, because some of these fields would go back to corn, with the owner's standard rotation.
10-26-2012 05:22 PM
We are farther south so we get a little longer season than you, but I think this works pretty well for us. We water in early to get the volunteer started asap. Then we delay planting at least a couple of extra weeks. Use a herbicide called selectmax a week before planting. It will get the vol. corn pretty well.
If you have whole ears it is hard to get chemical coverage on every sprout. But we have had pretty good luck with it.
10-26-2012 09:54 PM
That might work here, if we got an early spring. However, some years, the volunteer corn only sprouts a couple days before planting (sometimes not even that much, for the guys with a lot of ground to cover). Is it safe, to spray, right before planting, by just a couple days?
10-26-2012 10:22 PM
The chemical needs a few days before planting. We have crowded it (2-3 days) but it can hurt new corn if it is too close. Need to study the label. Soil type affects it also. We are a little sandy and higher ph. I've tried paraquat, but it's hard to get enough contact on the volunteer to get a good kill and working the ground just sprouts more if you have quite a bit.
10-26-2012 11:05 PM
The seller found a willing buyer. Good for them. No, it will not cash flow with commodity corn and soybeans. But if the buyer has the purchasing power and the desire to own the land, cash flow is secondary.
10-27-2012 07:13 AM - edited 10-27-2012 07:14 AM
You pretty well covered it EMNJK.
There have been sales in excess of $20,000 in Ontario recently.
One factor that increases the sale value can be a farm beside the buyer OR a property which lies between 2 properties that the buyer already owns.
Quota holders are usually the big value buyers in Ontario.
They have the advantage of a consistent income from their livestock and if they are efficient operators that extra cash to make the payments.
I do remember the late 1970ies when land prices rose rapidly and it was not good news for some purchasers as we went into the 1980ies and beyond.
Will history repeat itself? Again?
10-27-2012 07:53 AM
We know it will.. Lessons always have to be relearned.
Land that hasn't changed families in 150 years may sell three times in 10 years. Young farmers must understand that timing is everything to land ownership.
Lets call it land surfing. The surf is never steady. Sometimes the waves are so big they will drag you under quickly. You just have to paddle on and wait for a wave you can ride without overwhelming risk. Price is not the issue. How big your "board" is. Your age. How much you can supplement the payoff. If you need to figure the present corn price to make it cash flow.
The 70's-80's is such a good example--------remember---- The Russians bought our wheat------shortage----wheat went to 6-7. Land followed. Locally we saw Irrigated land go from $300 to $1420. (Not the cornbelt) A good. well positioned location, went for $1420 --the first time it had sold since homesteading-------out of area big farmer----- 2 other neighbors sold
In the 1980's I bought that same farm for $570 and struggled to get it paid for. The 2 neighbors got theirs back and the properties have resold 3 times since.
I remember this one every time I read someone say land always appreciates in value. Long term maybe. But we buy and pay for it in the short term.
We are certainly seeing some BIG waves. Blown up by a weak economy and cheap money. IT DOES NOT MEAN THE END TO OPPORTUNITY. MAYBE IT IS THE GUARANTEE THAT OPPORTUNITY WILL NOT BE THAT FAR AWAY.
10-27-2012 01:37 PM