Dairy Farm Lease

Tomjim

How much per year would a 100 acre farm (all in the one block) make in a lease to a dairy farmer.It is all good upland free draining ground with no waste.

cute geoge

Tomjim wrote: »

How much per year would a 100 acre farm (all in the one block) make in a lease to a dairy farmer.It is all good upland free draining ground with no waste.

Considerable less then last year anyway .I presume it is not suitable for milking without roads,parlour ,fencing
I will say 220/acre would be a good starting point for silage and grazing heifers

Tomjim

It is suitable for milking, roads and fencing is in place, parlour can be built

Mooooo

Depends on demand in the area. Reseeding required. If a parlour has to be put in or if its bounding existing farms. Too many variables really

charolais0153

A place went 8000 a year for 7 years for 30 acres with slatted shed . it had no entitlements but he was a young farmer so was getting entitlements on it. And it was only for sucklers

alps

Contact Shinagh farm's in Bandon. They have a very similar farm set up near the main operation. Similar size to what you suggest, where the owners have paid towards some of the infrastructure. It is leased out and run by a very good young farmer, but even discounting this year, income for the operation is very humble...it really is only a stepping stone to the next stage.

Very hard to see 100 acres without facilities as a long term play for someone...just won't be enough out of it for everyone. May be more valuable as a dairy support farm..

K.G.

Things are moving fast and 100 acres (100 cows) isnt what it used to be.unless its got potenial to grow it aint going to provide rental for you,repayments for investment and a living for an operater long term.this year we have seen margins crash but people dont seem to get bothered half as much as they do about a cent or two in the price.

_Brian

Tomjim wrote: »

It is suitable for milking, roads and fencing is in place, parlour can be built

I’ve no skin in this game, but are you saying you can build a parkour to least with it or the guy leasing it can build a parkour ??

Dakota Dan

alps wrote: »

Contact Shinagh farm's in Bandon. They have a very similar farm set up near the main operation. Similar size to what you suggest, where the owners have paid towards some of the infrastructure. It is leased out and run by a very good young farmer, but even discounting this year, income for the operation is very humble...it really is only a stepping stone to the next stage.

Very hard to see 100 acres without facilities as a long term play for someone...just won't be enough out of it for everyone. May be more valuable as a dairy support farm..

Kevin isn’t leasing it he’s the farm manager and it’s more than 100 acres.

davidk1394

K.G. wrote: »

Things are moving fast and 100 acres (100 cows) isnt what it used to be.unless its got potenial to grow it aint going to provide rental for you,repayments for investment and a living for an operater long term.this year we have seen margins crash but people dont seem to get bothered half as much as they do about a cent or two in the price.

A girl I know is leasing a 100acre farm and bought the 80 cow herd that came with the farm. Putting in a new parlor this year.

alps

Dakota Dan wrote: »

Kevin isn’t leasing it he’s the farm manager and it’s more than 100 acres.

It's not the main farm..here's a link

https://www.agriland.ie/farming-news/video-share-farming-a-win-win-on-34ha-greenfield-farm/

whelan2

Know of a 90 acre farm in south Wicklow leased out last back end for € 330 acre. 8 unit parlour on it

wrangler

Tomjim wrote: »

How much per year would a 100 acre farm (all in the one block) make in a lease to a dairy farmer.It is all good upland free draining ground with no waste.

good land is worth making €300/ac

alps

whelan2 wrote: »

Know of a 90 acre farm in south Wicklow leased out last back end for € 330 acre. 8 unit parlour on it

It can make perfect sense when the infrastructure is in place, and even an upgrade to that 8 unit parlour may be viable, but to put in facilities, stock, and provide for the owner and operator out of 100 acres will be very very tight..good size for operator starting off and building herd for a few years with a view to moving on, but no surplus in it for infrastructure investment..

Similar operations at similar money around here whelan, but all had milking parlour and pretty good facilities, and are now operating as tie ons to existing operations, where stock calves at home etc is sent out to fully stock the 100 acres with milking cows only. Only labour is milking cows for grazing season, with auxiliary labour and machinery supplied from home..

J.O. Farmer

wrangler wrote: »

good land is worth making €300/ac

But only in area's where the demand/ competition is there to do it.

Also good land is relative. Good land in leitrim won't be good land in Tipperary.

alps

wrangler wrote: »

good land is worth making €300/ac

And it may be worth 300 as an addition to an existing dairy farm or where facilities are good, but won't be viable where infrastructure has to be put in place, all paid out of the income of under 100 cows..

alps

Some expert non dairy farmers need to sober up a bit.

Renting a 100 acre farm, building a milking parlour and milking 80 cows...These are the figures

Ave of coop delivery 4775litres

Income 47775 x 80 cows @32c 122,291
Sale of calves 80x100 8,000
Less cost of 15%replacement 16,200

Sales 114,091

Variable Costs
Fert 13,000
Feed 14,400
Lime 2,000
Vet 8,000
Contractor 12,000
Seed n s 0
Plastic 800
Straw 2,400
Sundry 1,000 53,600

Fixed
Mach Running 4,000
Loan int 6,800
OD ing 800
Car 4,000
ESB 4,500
Phone 600
Depreciation 15,000
Repairs Bld 2,000
Repairs Mach 1,500
Sundry 1,000
Prof fees 2,500
Rent 30,000 75,700

Costs 129,300

Excess expenditure over income 15209


We can assume set up costs of above of 80cows, milking parlour, reseed farm , water, fencing ...no machinery total 288k

10 year loan repayments of 35,400PA

Interest and depreciation can be removed from above and put towards loan repayment but I think you will see this poor entrepeneur will have a throbbing rear end for quiet some time..

Timmaay

alps wrote: »

Some expert non dairy farmers need to sober up a bit.

Renting a 100 acre farm, building a milking parlour and milking 80 cows...These are the figures

Ave of coop delivery 4775litres

Income 47775 x 80 cows @32c 122,291
Sale of calves 80x100 8,000
Less cost of 15%replacement 16,200

Sales 114,091

Variable Costs
Fert 13,000
Feed 14,400
Lime 2,000
Vet 8,000
Contractor 12,000
Seed n s 0
Plastic 800
Straw 2,400
Sundry 1,000 53,600

Fixed
Mach Running 4,000
Loan int 6,800
OD ing 800
Car 4,000
ESB 4,500
Phone 600
Depreciation 15,000
Repairs Bld 2,000
Repairs Mach 1,500
Sundry 1,000
Prof fees 2,500
Rent 30,000 75,700

Costs 129,300

Excess expenditure over income 15209


We can assume set up costs of above of 80cows, milking parlour, reseed farm , water, fencing ...no machinery total 288k

10 year loan repayments of 35,400PA

Interest and depreciation can be removed from above and put towards loan repayment but I think you will see this poor entrepeneur will have a throbbing rear end for quiet some time..

Good figures, only thing I'd say is surely it's manageable to get 5500l, and a better price than 32c with solids, both of which would add about 30k onto them milk sales. But fully agreed 300+/ac is mental.

alps

Timmaay wrote: »

Good figures, only thing I'd say is surely it's manageable to get 5500l, and a better price than 32c with solids, both of which would add about 30k onto them milk sales. But fully agreed 300+/ac is mental.

Fully agree Tim...but surprisingly these are the average..

wrangler

Timmaay wrote: »

Good figures, only thing I'd say is surely it's manageable to get 5500l, and a better price than 32c with solids, both of which would add about 30k onto them milk sales. But fully agreed 300+/ac is mental.

€150 K for milk sales is manageable and you think €30000 for the land owner is too much......I think it's not enough.
Again it's at that level now because dairy farmers a have it all to themselves, no oppsition

J.O. Farmer

wrangler wrote: »

€150 K for milk sales is manageable and you think €30000 for the land owner is too much......I think it's not enough.
Again it's at that level now because dairy farmers a have it all to themselves, no oppsition

You think 20% of the farm income (not profit) isn't enough.

wrangler

J.O. Farmer wrote: »

You think 20% of the farm income (not profit) isn't enough.

Land is worth AT least twice as much as infrastructure plus stock

GrasstoMilk

wrangler wrote: »

€150 K for milk sales is manageable and you think €30000 for the land owner is too much......I think it's not enough.
Again it's at that level now because dairy farmers a have it all to themselves, no oppsition

Plenty of competition around me and you wouldn't count on one hand the amount of dairy farms in my area. 200-250 being paid for land for sheep and grain is common. One big operator will get It offered to him for a lot less but he has a reputation of farming land really well and looking after it even better

J.O. Farmer

wrangler wrote: »

Land is worth AT least twice as much as infrastructure plus stock

Only if you're buying it

Based on the figures presented you think the land is worth double. €600 an acre per year.

At that rate it'd nearly buy the land. €600 principle repayment over 15 years is €9k. Add in the 20% the bank will look for you to put in and it's nearly €11k. That will buy good land in a fair bit of the country and go a long way in diary country I think.

wrangler

J.O. Farmer wrote: »

Only if you're buying it

Based on the figures presented you think the land is worth double. €600 an acre per year.

At that rate it'd nearly buy the land. €600 principle repayment over 15 years is €9k. Add in the 20% the bank will look for you to put in and it's nearly €11k. That will buy good land in a fair bit of the country and go a long way in diary country I think.

No just stating a fact...land is worth more than double the value of stock plus infrastructure.
Buy the land then....don't know anything about companies tax etc but farmers are leasing in preference mostly

J.O. Farmer

wrangler wrote: »

No just stating a fact...land is worth more than double the value of stock plus infrastructure.
Buy the land then....don't know anything about companies tax etc but farmers are leasing in preference mostly

I don't see where you're getting the "fact" in relation to leasing in land which is different to owning it. Can you provide something to back it up or is it your opinion.

Land is more readily available to lease and the tax breaks I believe are favourable to landlords.

I wouldn't be familiar with company tax law either but the business would need to be registered a company and I doubt many 100 acre dairy farms are. They'd be more likely to sole traders subject to personal tax law.

wrangler

J.O. Farmer wrote: »

I don't see where you're getting the "fact" in relation to leasing in land which is different to owning it. Can you provide something to back it up or is it your opinion.

Land is more readily available to lease and the tax breaks I believe are favourable to landlords.

I wouldn't be familiar with company tax law either but the business would need to be registered a company and I doubt many 100 acre dairy farms are. They'd be more likely to sole traders subject to personal tax law.

As you see on here, land is making more than 300 if there's someone to push it, even leasing out my entitlements I'm getting more than the farmer.
On the company thing, I was preguessing you, I thought that you'd tell me there was no tax advantage to leasing as opposed to buying for the tenant as most are companies now....a lot of small dairy farmers have formed companies such is the profits in it now.

dar31

Wicklow Dairy Farm for leese

Good facilities, turn key job, just bring the cow.
Will leese them as well probably for more than their worth but sure they know the place.

€350/ac map acres, not them silly adjusted acs.

Entitlement also for leese at 70 % their value.

Super job, can't help but make money at it.

Up for leese due to better offer, going milking cows at €200 per milking.

🀣🀣🀣🀣

kowtow

wrangler wrote: »

No just stating a fact...land is worth more than double the value of stock plus infrastructure.
Buy the land then....don't know anything about companies tax etc but farmers are leasing in preference mostly

I'm not sure where that "fact" has it's origins.

If this thread points to anything at all it is that land is over-priced to buy, which in turn puts some upward pressure on rents. This is unsurprising given the persistence of negative real interest rates but that is not a situation which is going to continue indefinitely. When it resolves itself we will undoubtedly see the price of land (and the supply of land to rent) change to reflect the returns which may realistically be made by farming it.

Meanwhile there will be those - and i am among them - who under certain circumstances may pay €250+ (net of entitlements) for land which realistically has little prospect of paying it's way but these arrangements are hardly the stuff of which stable long term leases are made.

Company taxation arrangements have no material bearing on the viability of land rentals.

wrangler

kowtow wrote: »

I'm not sure where that "fact" has it's origins.

If this thread points to anything at all it is that land is over-priced to buy, which in turn puts some upward pressure on rents. This is unsurprising given the persistence of negative real interest rates but that is not a situation which is going to continue indefinitely. When it resolves itself we will undoubtedly see the price of land (and the supply of land to rent) change to reflect the returns which may realistically be made by farming it.

Meanwhile there will be those - and i am among them - who under certain circumstances may pay €250+ (net of entitlements) for land which realistically has little prospect of paying it's way but these arrangements are hardly the stuff of which stable long term leases are made.

Company taxation arrangements have no material bearing on the viability of land rentals.

I'd agree with a lot you say, if interest rates increased I'd probably turn the land into cash.
Your last sentence was what I was expecting from JO, Ordinary Farmers are bette leasing than buying.....having to pay for land from profits after tax is very hard
Some guys form companies when they go to buy land, so there must be some advantages

Burning Tires

wrangler wrote: »

I'd agree with a lot you say, if interest rates increased I'd probably turn the land into cash.
Your last sentence was what I was expecting from JO, Farmers are bette leasing than buying.....having to pay for land from profits after tax is very hard

Farmers may be better leasing tgan buying. But if land comes up for sale within an asses roar of the home block, reason and logic go out the window.
40 acre block for sale in my parish. I was interested in it as a long term investment, i doubt i'd farm it, but lease it out. 28 acres grassland, 12 acres scrub (5 of which could be reclaimed by spending €1000 to €2000 an acre)

I know the numbers dont stack up if you look at it with the cold eye of ROI, but there where land is involved "the Bull McCabe" effect comes into play...... at any cost.

Its currently at €480,000 and not even put up on the auctioneers website yet. 4 different bidders, 3 dairy farmers, and myself. I was the second bid in at €400,000.

Mooooo

dar31 wrote: »

Wicklow Dairy Farm for leese

Good facilities, turn key job, just bring the cow.
Will leese them as well probably for more than their worth but sure they know the place.

€350/ac map acres, not them silly adjusted acs.

Entitlement also for leese at 70 % their value.

Super job, can't help but make money at it.

Up for leese due to better offer, going milking cows at €200 per milking.

🀣🀣🀣🀣

Know of a lad who leased his land to neighbouring farmer and is working 9 to 5 for same farmer.

Doniekp

Burning Tires wrote: »

Farmers may be better leasing tgan buying. But if land comes up for sale within an asses roar of the home block, reason and logic go out the window.
40 acre block for sale in my parish. I was interested in it as a long term investment, i doubt i'd farm it, but lease it out. 28 acres grassland, 12 acres scrub (5 of which could be reclaimed by spending €1000 to €2000 an acre)

I know the numbers dont stack up if you look at it with the cold eye of ROI, but there where land is involved "the Bull McCabe" effect comes into play...... at any cost.

Its currently at €480,000 and not even put up on the auctioneers website yet. 4 different bidders, 3 dairy farmers, and myself. I was the second bid in at €400,000.

40 acre farm across the road from home house sold for 310,000. Good land too with road frontage nearly all the way around it. A local with plenty of money n sheep bought it. Would have liked to buy it but just after getting a mortgage to build a house so not doable. I haven't taken over home farm yet but would have been good investment but timing of sale wasn't right for me.

kevthegaff

I wonder do guys do the figures like alps or just bull on! 70 acres came up down the road from here not adjoining but only a mile away for lease, hilly ground which only 20 acres you could put in the pit. Rang the auctioneer to put 10 on it, he said there was 16 on it, I told him I'm out before I'm in, Good luck.

kowtow

kevthegaff wrote: »

I wonder do guys do the figures like alps or just bull on! 70 acres came up down the road from here not adjoining but only a mile away for lease, hilly ground which only 20 acres you could put in the pit. Rang the auctioneer to put 10 on it, he said there was 16 on it, I told him I'm out before I'm in, Good luck.

16 to lease?

What about entitlements?

wrangler

kowtow wrote: »

16 to lease?

What about entitlements?

they're only a disadvantage now, if you include them you'll reduce the demand dramatically

visatorro

kevthegaff wrote:

I wonder do guys do the figures like alps or just bull on! 70 acres came up down the road from here not adjoining but only a mile away for lease, hilly ground which only 20 acres you could put in the pit. Rang the auctioneer to put 10 on it, he said there was 16 on it, I told him I'm out before I'm in, Good luck.

You'd wonder about Fecking auctioneers aswell though!!

visatorro

Mooooo wrote:

Know of a lad who leased his land to neighbouring farmer and is working 9 to 5 for same farmer.

Win win.

kevthegaff

kowtow wrote:

What about entitlements?

No entitlements but maps