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N FLA | Serious question coup and others. I see the discussion below about paid for lant, rented land, eqpt, etc.
1. Do you think a partnership like this pulls all their income out, dividing up the profits among partners and recording as individual income, or leaves the money in a kitty for the future? They arent trying to build a nest egg to pay down principal or buy land I guess.
2. We have had the discussions on these pages that crop/dairy guys are drawing a line in the sand, they wont spend X$ of equity to get through the next slump. So the question.
2a. If someone has this farm model, no equity, and they sit down to project earnings, lets say they can lock in 4.00 corn in 2014, and estimate of 170 bushel avg for this exercise. Lets say they cant produce that crop with land rent/labor/tractor rent/drying/hauling/seed/fert/weed killer/etc for less than $680. Lets say they need $725/acre to have a go at it at 170 bushels.
2b. So you have three partners, do they each take $45x2333 acres and toss it in the pot and swing for the fences? For big time grain farmers, thats not alot of money. But how do they as farmers and business man approach a scenario like this?
I'm definitely not knocking the Top Producer candidate or the videos. I have had a similar discussion with a farmer in this area this week. Specifically, do you burn through last years profit this year to keep status quo, or do you let go of land/labor/lease less equipment/invest long term in more grain storage/etc, just to adapt to this years prices. (High corn/low cotton and peanut). | |
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