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01-31-2013 03:20 PM
SW- not sure what you mean, but a 185bu corn yield in 2012 for Iowa was standard on good-quality land. 185bu*$7.50 corn price= $1,387.50/acre in corn revenue, take off $425/acre for seed, chemicals, a hog manure spreading cost, etc. = $962.50/acre left. Then take off $150/acre in a Custom Farming fee, and you are left with a $812.50 profit per acre. Tell me what's wrong with my numbers? Do you honestly believe it takes more than $575/acre in inputs and Custom Farming fees to grow just 1 acre of corn? What do you think it costs me to grow 1 acre of corn? Tell me, I am interested. And yes, my farmland is paid-off, so a zero farmland mortgage payment per year.
01-31-2013 03:35 PM - edited 01-31-2013 03:36 PM
01-31-2013 03:36 PM
"185 bushel corn yield standard on good quality ground in 2012"
Iowa must have a very limited quantity of "good quality ground" since the state yield is 137 bpa in 2012
01-31-2013 07:08 PM
01-31-2013 07:17 PM
Ray, the local corn 'users' are actively sourcing corn, as we speak, for those remaining few bushels they need.
A few may be able to almost 'scrape by' with what they already have, if there is an early harvest like last year. The others, are putting the word out that they will be looking.
I have maybe 10K bushels in the bin, not spoken for, and I have already gotten at least 3 calls from users (2 feeders, 1 ethanol plant buyer) who called me, and asked for a chance to buy my corn when I was ready to sell.
Already, I got offers of 'whatever anyone else's posted price is (on the day I want to sell), plus we will let you hire a trucker of your choice, or pay you the same per bushel as a trucker would have, if you deliver it.
Until this year, no one ever calls me, except maybe once in a while a small local feeder, who is only 5 miles away or so, who buys corn in 1000 bushel increments (he says 1000 bushels lasts him a good week). That makes me think, they are wanting to take actual corn.
If they own calls, the most extra it would cost them, is gain in basis, which I doubt would be all that much.
02-01-2013 01:54 AM
$ 500 cash rent received Jan 31, 2012 and invested in (insert stock option here)
Stock gained 50% in past 12 months Now original $ 500 is worth $ 750 and I have the cash in hand
Just received my $ 550 cash rent (due Jan 31, 2013) Time to invest my $ 1300 per acre rent into another business
With this kind of ROI, I just don’t understand why anyone would custom farm? I mean, if you still had 80% of your corn not sold and in on farm storage you are one natural disaster (tornado, rot, bugs, etc) away from an insurance check (assuming your paying insurance)! Besides insurance also storage costs and hoping the market goes your way!!
What if we stay dry? Who cares, I live in the city and am a business man with my rent money in hand. If the BTO is not managing his outfit properly, no problem I will find another renter on the corner!
My sense of humor may be a little twisted but I just couldn’t resist.
Have a great weekend!
02-01-2013 06:26 AM
RSW, seems to me you have stirred the hornets nest with all your financial expertise. Do you think maybe it's time to give it a rest? Not trying to second guess anyone here, but appears to me that not to many contributors at the moment give a darn.
02-01-2013 08:35 AM
RSW after much thought I consider you either a fraud or an idiot, maybe both. The final straw was bragging over a foreign vehicle. ALL the farmers I know consider themselves true Americans and would never buy a foreign car.