Barn Talk - Barn Talk Q&A: Billionaire Land Investors, Hog Barn Cash Flow & CA Prop 12 Law

Episode Date: November 9, 2022

Welcome to Barn Talk, Q&A edition. In today’s episode we’re answering your questions. We cover our thoughts on 9-11, hog barn cash flow, update on Prop 12 law, billionaire land investors & much, much more. Pay the fee! Barn Talk Merch! 👇🏻 https://www.thislldo.co/ SUBSCRIBE TO THE PODCAST ➱ https://bit.ly/3a7r3nR SUBSCRIBE TO THIS’LL DO FARM ➱ https://bit.ly/2X8g45c SUBSCRIBE TO BARN TALK CLIPS ➱ https://bit.ly/3BlZnqq LISTEN ON: SPOTIFY ➱ https://open.spotify.com/show/3icVr4KWq4eUDl7Oy60YMY ITUNES ➱ https://podcasts.apple.com/us/podcast/barn-talk/id1574395049 Follow Behind The Scenes👇🏻 ● This’ll Do Farm Instagram ➱ https://bit.ly/30KPBNk ● Barn Talk TikTok ➱ https://bit.ly/3qciekS ● Sawyer’s Instagram  ➱ https://bit.ly/3BtX0n4 ● Tork’s Instagram ➱ https://bit.ly/3LGZJxS ------------------------------- ***PLEASE NOTE*** Barn Talk is a significant break from the typical content viewers have come to expect from This’ll Do Farm. Please be advised that we will be exploring a wide variety of topics (some adult-themed) and our younger viewers (and their parents) should be advised that some topics will be for mature audiences only. ⚠NO FINANCIAL ADVICE / DISCLAIMER⚠ The Information discussed and shared on Barn Talk is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or success for any particular purpose. The Information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The Information on this podcast and provided from or through our content is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional, professional broker or financial advisory. Understand that you are using any and all Information available on or through this website at your own risk. RISK STATEMENT– The trading of Bitcoins, alternative cryptocurrencies, NFTs, individual stocks, etc. has potential rewards, and it also has potential risks involved. Trading may not be suitable for all people. Anyone wishing to invest should seek his or her own independent financial or professional advice. Learn more about your ad choices. Visit megaphone.fm/adchoices

All of the food we eat and much of the clothing we wear comes from plants and animals that are raised on farms. Farms are different in type, in size, and even in name. Welcome to Barn Talk. What happens that the barn stays in the barn. Until now, we're going to let it all out for you guys. Today is going to be a Q&A episode. So for those of you that are new, we got kind of three different formats of show. We got a Q&A episode where you submit your questions in at BarnTack Show at gmail.com. come and we'll answer them. Then we got a barn talk hot topics where we just talk about all the world problems going on in our country, in the world, whatever. Just whatever's cruising on the internet we kind of talk about. And then we have another kind of show where we just interview

interesting people that come on the show and want to tell their story. But today, like I said, it's all about you guys and your questions that you have for us. So before we get into all that fun stuff, pay the fee. If you guys get any value, you from the show, share it out with your friends, family, co-workers, employees, whoever we're trying to grow this thing. The more people we reach, the more our grow shows, the better guests we can get on and the better content we can make for you guys. So we appreciate every single one of you that have been doing that. It really, really helps a lot. We see your Instagram stories. We see your posts on other social media platforms of everybody paying the fee and it just means a ton to us.

Also, you can leave a review on Spotify or Apple. We're up to 400 and 90, I think, on Spotify, five-star reviews, and we're up to 100 and almost 75 on Apple Podcasts. So really, really appreciate all of you that do those things to help promote the show. So, without further ado, Tork, what are your thoughts on today? How's it going? What have you been up to? A disclaimer, if you hear a lot of racket at some point, there's a, there's a thunderstorm, which is almost...

almost unheard of. We haven't had a good thunderstorm, and I don't remember how long it's been, long time. So the next two days are going to be very rainy, which we were just getting ready to start pumping manure, so that's fitting. But I'll take it. It can rain quite a bit before we're anywhere near enough water

that we're going to have any trouble getting our fall work done. so I'm excited. I'm excited too. Yeah, just so if you hit or anything on the rooftop, don't turn off the show. It's just the rain pitter pattern. Yeah, it'll soothe you. It's soothing.

Yeah. Kind of like the sound of my voice. Yeah. No market update today, right? No, pretty much the markets are running on, is there going to be grain coming out of Odessa in Ukraine or is there not? because last week the Ukrainians blew up or bombed a Russian frigate. Week goes up 55 cents.

A day later, because the Russians say we're done. We're not doing any of this. We're not having any of this. We're shutting it down. And then a day later, they go, well, wait, we were a little hasty on that. We were just kidding. We're going to stick with these grain shipments. And then it was down 60 cents.

And other than that, I feel like everything's kind of trading day by day. so not much to I mean we could do a whole stinking episode about commodity prices but I'm not going to do it today because we got some great questions we do got some great questions and like I said guys submit a men at barn talk show at gmail.com that's where you can reach us the best to get your questions get your questions answered and we like the deep shit so send us the deep shit not the surface level shit and these are some deep ass questions so this is the kind of stuff we like seeing doesn't just have to be farm can be about anything So we're going to get into it. And I'll start off with reading off this question. Also, they're going to be anonymous. So if you submit one, don't feel like we're going to call you out and share your name to the world. Just know that they'll be anonymous so you can talk about or ask any question you want. Unfortunately, I'm having a tough time deciding my future with the farm.

We farm are about 750 acres and don't have enough income for me to come back to the family farm. I have a passion for pigs and for the past year have been kicking around the idea of building a hog barn. Unfortunately, as you both know, the building prices are completely insane right now. My bank said they'd loan me enough money for two 5,000 headsites, which is awesome, but they don't cash flow. At what point do you see hog barn prices come back down to earth if they ever do? I don't really want to invest in land because I feel the ROI is poor compared to hog barns. I'm a junior at Purdue University studying agribusiness, so I still have about one and a half years left until I really have to decide what I'm doing. Any helpful tips would be great.

I love all your videos and keep up the good work. Well, big question. Thank you for that. It is tough. On the building side of it, those prices are not going to come down anytime soon. We've seen lumber. We've seen lumber go down. Steel, raw steel, I think, has actually come down.

but the biggest problem that you're fighting in that industry right now, I think, is probably the cost of their labor. So equipment on the building, the equipment that goes into the buildings, and then as far as getting the buildings put together as far as what people are paying their crews and the availability of labor to build these buildings, that's not getting any better. I think it's a struggle for everybody. And a year from now, buildings aren't going to be, they're not going to be cheaper. Loans aren't going to be easier to get.

Well, and that's the other thing is, so you're sitting on 7%. I don't know what you can get a 12-year note on a barn or a 15-year note on a barn if you got to go that far. But, you know, it's doubled. You know, a year ago, we were at 3%. they raise three quarters of a point. We're probably,

mortgages are probably going to hit seven and three quarters percent. There's a good chance by spring. We're going to 9% on mortgages, 9% on operating notes. So we just, we talked about this several times, but, you know, if you're farming and you got a million dollar line of credit,

the cost of having that credit's more than doubled now. And it's going to, it's going to, basically it's going to triple because you could have been at 3% last spring. and by this coming spring, you could be at 9%. Yeah. So these buildings, if it won't cash flow, they're just not.

So what you've got to ask yourself is, what can you do to subsidize that? The other side of it, well, I'm not, the other side of it's not the way to say it, but one thing to keep in mind, if you're looking to build these sites and you're grain farming, I always said when I was selling barns that if the company that's getting you to build a barn for them is using manure value in the cash flow, chances are it's pretty damn tight

because it's so hard to put a value on that manure. I will say this, with fertilizer prices the way they are, that manure definitely has a value, and it's definitely more value above the cost of having it applied. If you can use that in your farm, that will save you money. That does help that barn cash flow. Does it help enough?

I'm sure probably not, but it does probably close the gap. Yeah, I would just say what you were talking about. You got to find a way to subsidize it. So, I mean, like, I don't, I built my barn. What did I build it in 19 or 20? I don't really take any money away from my barn, you know, and it has a little bit of cash at the end of the month, but not enough for me

to make a living. It's not like it used to be. So right now, I bet it's even worse. I bet you don't have anything left over. So you can maybe still do it if you found another way. You would have to lurk another job off the farm. I mean, you just would. You'd have to earn enough income that you could afford to pay the remaining balance on your mortgage on your barn after you receive your payment from your integrator and all that. So that's one way you could make it work is just dumping money into it to make it cash flow, which is very possible, but you got to find a good enough job or have a good enough venture. And it's got to be flexible because if you're looking to build two five thousand, you have a lot of time. That's a lot of work. Yeah, that's a lot of work you're going to be

taken on. But it's not much. Um, Yeah, that's the other thing. It's a lot of work just to take care of two 5,000 headsites. The other thing I would say, and we've talked about this many times on the show, is these big sites, man, I don't know if I'd build a big site anymore. You got a big site. Dad built a double site, and we don't really like them. It's a be-auch when you're getting pigs in,

because you, especially in the winter, because you've got to heat those barns, and they don't all come in in one day, and you're blowing a ton of money on LP because you're just burning it. Loading out is kind of a grind because there's so many loads in that double site that you're low now and it just feels like it's never ending. The health isn't as good. I don't care what anybody tells you. The health isn't as good in those double sites.

You get something in there. It takes longer for it to run its course and it has to work its way through the whole site. And it's just not as good. I mean, yeah, here and there. you get a group that, you know, is every bit as good as what you run through a single 24. But it seems like so many times we have issues, and it takes way longer for the pigs to get over it in those double sites. Yeah. And we're not, the farmers and the growers aren't the only ones recognizing that.

The integrators are recognizing it too. So I know there's more and more integrators now that don't really want to touch big sites because they, they do. recognize that the health isn't as good as if you did have a single 2400 separate, you know. So that's something that I would just recommend you look into a little bit more before deciding that you're going to build not only one, but two big sites, you know. Yeah, and let's face it, I asked this question, clear back when I was still selling. So, you know, seven, eight years ago, for my generation or for that group of people through the through the 2000s, in the 2010s.

The hog building was the way that you brought another generation into farming, because you could build the building, it would cash flow, you had the manure, you could pay, you could take a little money out of it, you know, for labor to help get that next generation started. Can't do that today. And I would always ask people within the banking industry, within the ag lending industry,

like what's the next hog building? What's going to be the thing that's going to enable these kids to get started for young people to get started? And nobody ever seems to have a good answer. And that's kind of where we're still at is your story is no different than many, many kids around there, young people around there.

I don't know what that answer is. because is it building a confinement cattle lot? I don't think so. I think that the billing costs in that deal are getting to be about the same scale. I just don't know. I don't know how you're going to sustain, how you're going to get started with an on-farm deal.

I feel like you're going to have to find a side hustle where you may, on a grain farm, you may literally not have a, you may be farming in the family farm, but you may not be working in the family farm except for that spring and fall. You may have to have a side hustle. You may have to get a mini-ho. You may have to farm, grain farm,

take care of your buildings, and have another job off of that too. Yeah. I mean, that's the reality of it. I don't know. It's just tough. and I think interest in the general economy is just going to make it that much harder.

So you said you've got a year and a half. I know by spring of this next year, we're going to know a lot more about how resilient the American economy is and how much damage gets done to the world economy at large and how that plays off. long term I'm very bullish on agriculture

I think that there's going to be a lot of profit to be made but short term I think it's going to be very difficult and yeah I would say the one thing to look out for not don't ever just rule out and ever build a hog mart if it doesn't work out this first time because one thing that could change and make it cash flow is if these integrators pay more money

per pig space to their growers that might that's going to help make these barns cash flow a little bit better you know so be watching for that because that might change i don't know if it does i don't know if these integrators will have to pay more i don't know what that looks like but that is something that could definitely help definitely help and happen in the future as well so yeah and here i'll give you one i'll give you a deal because i know somebody that's kind of doing this um talk to people don't be afraid to talk to people because there may be somebody in your community that has hog buildings that they have either been choring them or they've been having somebody for the integrator chore them and they may not be very damn happy with the quality of care that those buildings are taken.

And I know a guy that's got a deal where he's choring the existing sites for this farmer. and in return he's building a new site and that farmer is going to get the manure out of it but that farmer's helping him out with the infrastructure. In other words, he's paying for the dirt work and building the driveway and get the power back to the building to help it cash flow. So the deal is this guy is going to be able to get this barn built

to where it'll cash flow enough, but then he's basically signed a deal that he's going to chore these other barns for a period of time with the idea eventually he's going to buy those barns from that farmer. So it's kind of a win-win because that farmer doesn't have anybody that's going to take over the hog part of the deal and he wants the fertilizer and he wants somebody that's going to take care of his sights better than what he's getting done from the integrator. And so it's kind of a mutual deal. And I think that's, we're going to talk about that with another question, but we're heading into a time where there's probably going to have to be a lot more creative and working together and maybe finding a partnership where you ordinarily wouldn't think there would be one.

Yeah. I think when you head into these kind of times of uncertainty and just, you know, the recessions, the buzzword being thrown around, you know, it's how well you can get creative on financing deals, getting deals, working with people. But if you do work with people, make damn sure you got everything in writing and make damn sure that you can trust this person because there are some cutthroat motherfuckers out there. So just make sure that you got your shit written down and got a lawyer and all that stuff. But I hope this helps out a little bit, man. I don't know if we try to give you as much value as we could on that question. And we don't have all the answers either,

but those are just what we were thinking on that one. So I hope that could help a little bit. You're going to ask me a question now? You always set the outline down and get on a real ramble. Well, you're always so damn interesting to listen to you. I just forget about, well, this is right up my alley here. Okay. So, hey, guys, have you ever heard of the 9-11 being a conspiracy?

I've heard multiple stories of it not being a terrorist attack, just wanted to hear your take on it. When I first, yeah, right, I don't know if I, when I first saw this question in the email, I was like, no way I'm putting this on here. But you know what? This is Barn Talk, we're real. We want to talk about things that you guys want us to answer.

So first of all, I just want to say, I don't know much about the conspiracy theories that have been going around. I haven't looked into it. I've heard a little bit about them. I think people really believe that it's a lot to do with the military industrial complex. They wanted to give the American people a reason as to why we wanted to go into Iraq. And so they say that that's what they plan that to do that to pretty much, I guess you'd say, quote unquote, manipulate the American people into thinking that we need to go in there and light a fire under our ass.

so I'll just say this. I don't necessarily believe that that's true, but I don't know. None of us will know. But I wouldn't put past, I wouldn't put anything past these people at the top that are elites, that are the establishment. You can see the last three years with COVID, how big of a disaster that was of truly making people think one thing, shutting down businesses,

shutting down the world essentially for almost two years, and then now it's like it's nothing. I don't really trust much of what the establishment has to say at this point, and I think a lot of people are there, but we don't know how long they've been scheming up shit like that.

I don't know, and I don't think we will ever know. And I want to also say that I don't want to dishonor anybody that was affected by 9-11, all the families, all the firefighters, all the first responders, all that. It was terrible, terrible, terrible thing. But like I said, I don't think we'll ever know. And I don't think I wouldn't put anything past these people at the top to control and get what they want.

They look at us like little fleas and they can move the chest piece and the chessboard however we want. Or they think they can do that. And we'll just go along with it. salsa, whether it's Verde, Roja, or the orange one. For Jeff, trying any salsa is like playing Russian roulette with a flamethrower. Luckily, Jeff saved with Amazon and stocked up on antacids, ginger tea, and milk. Habaniero? More like habanier, yes. Save the everyday with Amazon. So 9-11 will be, it will be looked back a lot like the Kennedy assassination. I mean, there's a lot of people that thought that at some point we were going to know what really happened

to Kennedy, whether that was the mafia. Random deal. It was the mafia. It was the Cubans. The FBI, inside job. Whoever. And guess what? a heck of a lot of those people that were around, that were involved, that knew anything, are all gone, and we still don't know. And I think that years from now, we will still never know whether or not there was anything different than what was portrayed to the American people and to the world about how that happened, why it happened, why it was able to happen. I don't know. But, you know, I agree with Sawyer and the fact that I think there's probably a lot that goes on within government and within their relationship between the military and the private sector and world policy as far as things that are done, deals that are done, whatever.

There's just an awful lot that we don't know. We never will know. But it, I hope nothing like that happens here again. And it was a terrible, you know, that's a terrible day in American history. And I just don't have the answer. I will say, you know, there was a lot of bad that happened with 9-11. But there were some good things that did happen as far as airport security got way, way, way, way better. and I think that is the most united we've been in decades. You know, that's the most united we've been in decades, which is sad, but also it was, you were really proud to be American during that time. I wasn't really obviously old enough to experience that, but seeing old, you know, seeing old videos and just people that did live that,

talk about it, how united we all became, I think that it would be awesome if we could, somehow unite like that again, just not with a terrible tragedy. But, yeah, I don't know. I have a lot of, I have a lot of cynical views on the people at the top and the establishment. And I really do think they wouldn't, I really think they look at us like ponds and that they can control us however they want. You're only 22 years old and you're already cynical. Well, have they given me evidence to suggest otherwise?

I mean, truly... I'm glad that when you're my age, I won't have to be around you because you'll be a real downer. Well, I'm hoping when I get to your age that we've changed some shit and we don't have corrupt fucks in power. Gosh, I hope so. That'd be really nice. But I don't know if that answered your question much, but that's our thoughts on it. And we'll keep on pressing on. update on California law on size of pens for sows.

Will it impact other states and animals? Wieners, weaner pigs. Is there a pattern of normal bursts out of, say, 10 pigs? What percentage is above, average below in size slash weight? Does this impact you in planning? Well, so first of all, it affects, so that law affects the entire, the entire country. That law wasn't just on Iowa.

It's more that the national pork producers filed a lawsuit, and the national pork producers, I think, are based out of Des Moines. So the case that's at the Supreme Court now, I think it originated out of Iowa. But if that law stands, it affects anybody that is going to try to sell pork within the state of California.

And yeah, so does it affect us? Well, it will, it will at some level. Now, the thing that there's so much, and I think we talked about this, clear back when we went through it, but the logistics of it are very difficult to say the least because you've got to be able to,

obviously if this law is allowed to stand at the due date there's no way that all the port produced is going to meet that standard so that means that people that raise pigs they would have to if they have multiple sites and some of those sites are converted some of those sites aren't converted they would have to be in talks with the packing plant the harvest facility so that they knew which pigs or from which sites and then that harvest facility they would have to run different lines or different days so that they knew that all the meat that came that was produced from this site met the requirements and this site this day we're not going to meet the requirements right and then out of that you know there's a certain amount of there's a certain

amount of waste really i guess you'd say where some of the meat that would be produced that would be Prop 12 certified, wouldn't go to California. It'd probably go to Mexico or go wherever. So it's just a lot of moving parts. And at the end of the day, I really question whether that law will be allowed to stand under the interstate commerce clause because basically California is dictating how other states do business. And that's kind of the purpose of. of the Interstate Commerce Clause, as I understand it. So I guess I'm hopeful that it's going to be ruled, overturned, whatever you want to say.

But as to whether or not, you know, if it does, chances are somebody's going to go to work on a different version of it and try to make it work and whatever. And as far as the production goes, this is what I know. and there are plenty of people that have got sow units that are already Prop 12 compliant in other words that standard

there were people doing that before this ever happened because there were other not so much states or municipalities but other buyers other large whether it be a grocery change

or a restaurant chain or whatever wholesalers that for whatever reason they wanted that they wanted that stipulation kind of as a feel good that they felt like they could market that to get more money out of the pork they could sell the same cut of pork for more money increase their profit margin because it was produced this way so it's it's out there but what it comes down to is you know, your group housing sows, and on the farrowing pens, on the farrowing crates, I don't know if it stipulates crate free. I should have reread the, I should have reread the stipulation before we sat down, but if it is group sow housing and farrowing in pens,

you ask, you know, what's that due to your number of pigs born live or your weaning weight or whatever. So I will tell you that at the top end, if you have the best people, if you have the people that are the best at taking care of gestating sows, breeding sows, working in that area, and you have the best people working in a farrowing house, I'll bet you that you can get, you can get production out of one of those units, that is within the top 10% of farrowing units anywhere in the country. Here's where the problem is. There's very few people out there that are actually really good at those jobs,

and there's very few people that are, what I would say, like, motivated to do a good job and that are cared for by the people that own those units, It's no different than any other job in this country. You have people that work in awesome systems that are heard, that are valued, that feel valued, that feel empowered, that do an excellent job. And then you have people that are not, and for whatever reason, they're there to collect a check. Where this really gets into trouble is when you have management and employees that, that are less than the top 25%. So if you have a conventional farrowing unit

where sows are housed in gestation crates, not pens, so as to keep them from fighting and to make sure that they each get a customized diet that you can, and they get individual care and they can't fight and all of that. And they can't kill piglets as easily. And then in farrowing crates, where they're, the sows can't lay on the pigs they farrowed and they can't bite them, they can't hurt them, they can't, whatever.

Okay, if you're in a system that's anything below the top 25%, your outcome gets exponentially worse. And I don't, I can't tell you that there's a study that will show that, but you can see that in regular numbers. In a system where all of the sow units are the same build, In other words, everything is the same. As far as the crate design, the farrowing rooms, the number of sows, da-da, da, da, there is a difference from the best to the worst and it has to do with the employees. And what I'm telling you is if you have two SOW units and the quality of employees are the same and the quality of the management and the employees is not in that best percent, the outcome of the production and of the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the.

sow turnover, the sal mortality, the non-productive sow days, whatever metric you want to measure it by, it is worse in a unit that is group sows housed and

pen farrowing. So if you have poor production in a conventional system and you switch it, you're going to have even worse. Even worse. And, you know, argue with me. You know, change my mind. Whatever you want to say. If you're new, you have had a lot, a lot, a lot, a lot, a lot of experience in the industry. You've gone to many sal units. You've farroed pigs yourself. You know. You know. It's not like dad is just

saying this like he's never been in a sal unit or doesn't know a lot of information about what sow units, how they perform. I mean, you've worked in a company that knows. The people make the difference in whatever, whatever style system you have, the people make the difference. However, my opinion, my opinion, 100% is that you, if you have a group house sow unit with free stall farrowing, whatever, you are setting yourself up for disaster because you've already, you've already put your employees at a disadvantage because it takes a much higher level of management to get a good outcome out of a group sow environment. And we're already, we taught every, whatever industry in, if you're listening to this, doesn't matter what you're in, you,

your companies have the same conversations. It's about labor, lack of labor, and lack of good quality quality labor. And agriculture is no different. We are probably one of the few industries that are probably hurting, you know, it's lacking the most in because let's face it, it's hard to make a living in agriculture right now, but also not many people really want to get their hands dirty and work in a freaking sow unit. So you're left with the people that have to work in a sow unit. Well, there's very few that are like, I love getting up and going and working in a salary unit. And there are people that do. There are. And those people work in the best managed units where they're valued as employees and it is a priority to help your employees grow, not only as an employee, but as a person. And that's

not a big enough percentage. And that's no different than anything else. All of you know, all of you know, if not within your own company, somebody that you know that works at a company where they don't feel valued and they, you know, they pull their hair out about management. Well, ag is no different. But to strip it all down, this isn't going away. This idea that we should go this route is being pushed by people who want to make it more difficult for us to raise meat. That's what it comes down to. And before we get off of this, I could not find this story. Jim Long had a story on Swine Webb last week, and he was talking about prices of meat in the grocery stores in Europe. And his takeaway on that, obviously everything's up.

It's up more than what inflation is. the cost of meat is higher. But one of the points I thought was very interesting, and this is coming here, and you are going to see this. All of this pasture-raised, crate-free, group sow housed, walnut-fed, whatever you want to call it,

all this specialty pork, And I'm not just pork, but beef chicken all of that. It will take a much greater jump in price versus conventionally raised meat because the cost of labor, the cost of inputs, the cost of utilities, the cost of everything that goes into it takes more. It is less efficient. and its cost is going to go up faster. And so what I think is going to be very interesting

is all of the people that buy this shit out of a field good because they want to be able to, oh, well, I only eat pork chops that are grass-fed. First of all, I wouldn't eat a grass-fed pork chop or whatever. I don't care what it is. It's fine if you want to eat it. It's okay. You can't eat a grass-fed pork chop because pigs need fucking grain.

So if you're one of those people. Well, you're going to just all I'm going to say is you're going to pay a hell of a lot more for it. So the rate of food inflation for me, non-conventional proteins is going to increase faster than conventional because of simple economics. Yep. So anyway, that's my, that's my ding on prop 12. I don't know what the Supreme Court is going to rule. My gut is it's going to get thrown out, but that doesn't mean it's over. Um, the fight goes on and, um, I think, I think at the end of the day, we're headed time where

simple economics is probably going to fix a lot of this. Yeah. And I would say it doesn't help when you're trying to, if you're one of those people that wants to get those kind of proteins and you're going to see that if this continue, this trend continues in America, you know, the inflation on food or inflation on meat. You think you have it hard now. You think you have to budget now. You think that it's, it's really hard to, you know, live in America today now, you add that on top of it. These times are going to be even harder, even, even harder. And I think Americans might start to realize how good we really have it and how stable our food system really is and how productive our food system is.

And why it's that way. And why it's that way. We didn't get here by being a bunch of dumbasses that are money, you know, money hungry fucks. we lived it every day. Farmers went through scenarios. They had sows die. They had wiener pigs die. Sal's fought. You know, out, they grandpa out in the pasture, you know, put them in buildings for a reason. And it was out of logic, not being a greedy fuck. So that's my two cents on it. That's right. That's right. Okay. I live in Northwest Iowa, and my question is based on recent changes that I've seen in my area. And this is kind of a lengthy one, but it's good. It's good to talk about.

Recently in the last six months, a billionaire investor in both farmland, real estate, and banking out of Nashville has been purchasing farmland by the thousands of acres in northwest Iowa, adding to the 130,000 acres they already own in the Mississippi Delta, Napa Valley, and Florida. These recent purchases have been at record-breaking prices, in some cases, $20,000-plus an acre, and most of the time outbidding a local farmer in doing so. In the last six months, they have bought the farm at every auction in Clay County alone, give or take one or two, along with multiple private purchases. The land they are buying is being farmed by a small group of extremely large farm.

farmers in the area who are over the 10,000 acre mark each one of them. The deal between the farmer slash investor is a story of its own, all on its own, but for another time. Being only 23 and just starting to get involved in my family farm, these events are very troubling and scary to me for the future. Is this what the new agriculture is going to look like. Is this my competition, if you want to call a billionaire competition? What can I do about it? How do you guys feel about this? Is it as big a deal as it seems right now? I'd love to hear your thoughts and thought it's a good conversation with the likes of Harry Stein, Glenn Taylor, and another few investors already in the land buying market. Thanks. Love the show. You guys are awesome.

Really appreciate that question. That was a damn good question. And I want to give a shout out to you because you did your damn research on this question. I mean, finding all how much they paid an acre at the auctions, uh, where they're from. I mean, shit, man, you did some really good research and we appreciate that kind of question. That's the kind of stuff we like to see. There's a lot to impact here. A lot to unpack here. And I obviously, we obviously don't love seeing that. I don't think any farmer really love seeing that. But at the same time, I sit there and I don't like that because, you know, I want family farms to continue going on. I want more American family farms to stay intact, just like our farm here. And I don't like the idea of billionaires, investors coming in and

buying up all this stuff. But at the same time, I'm a pure capitalist, and I believe in capitalism. and I don't want to hate on the success of other people because I believe what you put into this world is what you get out of it. And if you're somebody and you're telling the universe that you don't like successful people and that you don't like investors and you don't like that, you're telling the universe that you don't want to be wealthy or telling the universe you don't want to be successful

and the universe will give it back to you. So that being said, I think a lot of these billionaire investors are parking their money into farmland right now because there's nowhere else to put it and it's a really good store of value. It's been proven for decades that land prices are just going up and up and up and up. I think these investors and these billionaires are looking at, well, where else can I store my money in with uncertain times? I'm not going to put it in the stock market. I'm not going to put it in crypto. I'm not going to put it in the housing market. I'm going to put it in

land because it continues to go up. So I think a fair amount of them are buying and then eventually I think they're going to sell. Yes. But I do think there are some Bill Gates out there that I don't know what the fuck he's cooking up, but it ain't good and I don't like that. And he could very well hire you know, private, you know, small farmers to farm all his acres or, you know, start a company or start raising fucking crickets and making us eat those. I don't know what he's doing. But and that could cause a trend of other, you know, very wealthy people to say, well, if Bill Gates is doing that, I should do that, right? And that is scary. I think a solution, and dad brought this up, and I think a lot of farmers are also thinking this, is I think farmers are really going to have to get,

they're going to have to put their ego aside, they're going to have to sit down with farmers in their area that they've been competing against for a long time to buy land or rent land, whatever, and you might have to put your differences aside and team up to weather what this is. I don't know if this is the future. I think, like I said, many of them could just sell all their land and they're just putting it in as a store of value right now because the economy's shit. I don't know. But if it is, if this is the new future, I think farmers are really going to have to team up, put their ego aside, and work together to weather the storm and hustle your ass off. You know, you're really going to have to hustle your ass off even more to become a farmer or to stay a farmer.

And you got to control what you can control at the end of the day. That's what it all comes down to. You can't be mad at the world that you got dealt, the cards that you were dealt. You just got to play with the hand that you got and make the best of it, you know. you were born with the circumstance. You were born into a family farm. So that's a blessing. You just got to keep pushing on and really focus on what you can control, really. And be looking for opportunities and keeping the back of your mind that you might have to partner with some farms, some other farmers in your area to keep it going. So your thoughts, I went on a little tangent there,

but I had a lot to say. So there's two things that play there. One is the investors that those people are going to go wherever they think the best return on money is. And there's a host of reasons why they're going into land now. And that trend's been going on for a while, but I feel like it's kind of picked up its pace. And let's face it, what are you going to do with your money? Because you can't have it cash. Cash is worthless.

The stock market, if we could show you slides, I'd show you a slide, two different slides. One is the money supply. So people talk about time in the market, time in the market, time in the market, and over time, the stock market goes up. Well, that's true, but if you take the stock market and you lay a graph of the money supply right beside it, guess what? The more money that's been pumped into the system, printed, out of thin air, the stock market's gone up.

If you adjust the stock market for the amount of money that's been printed, it's basically flat. And now then we have a federal reserve that knows that it is limited on tools, and I'm not going to get into all this because this is demographics get into this. We need to have Peter Zion on, because he can explain this better than me.

but what the United States is able to do right now with raising interest rates, the rest of the world can't do that because their demographics are working against them and they're limited. They're going to run this hard because what they're trying to do is they're going to start bleeding the money back out of the market. They want to get all this money out of the market. Okay. That's one side of it.

So obviously there's a reason all these vesters are coming to land because right now it looks like a more solid investment, an investment, a safer investment. If the economy changes, tomorrow next year, three years for now, five years for now, land may not be that investment. And if that's the case, you'll see them sell. You'll see them get out of it because they don't care. It's not like they have an emotional attachment of the land. They're just doing it because it's an investment.

The flip side or the other side of that coin is they got to rent all that land to somebody. and you talked about how they're renting it to these large land or these large farmers that are farming tens of thousands of acres. That's a whole different problem. And there's a certain amount of guys that we've talked about it before. They don't care at the end of the day about anything other than being a BTO. And they want to run big equipment, lots of it, and be an operator. and at the end of the day, if they don't make any money, but they just keep going, they're tickled shitless.

And there's some of them they're making a shitload of money doing it, too, the ones that can really manage it. But what I will tell you is, if they were not renting that land from these large landowners, they'd still be renting it, and they'd still be paying too much, and I'll throw something else out to you. Because this has been talked about a lot,

and to my knowledge, it hasn't really had. happened, but if you don't think that these large corpse are not thinking about when this will become feasible, if you're somebody like, say, Syngenta or Bear or Corteva, and you want to sell seed corn and you want to sell inputs and you're in a cutthroat market, how's the best way to do that? well the best way to do that is take your biggest farmers and say hey if you use my seed and use my chemical program i don't give a shit what you pay for rent i'll guarantee you this much dollar per acre return i'll guarantee the lease on your equipment you just decide how many acres you want to farm and we'll make it work now that's a very big oversimplification

but if you don't think that those conversations haven't gone on within those corporations, you're kidding yourself because they have, I know for a fact they have. So you're saying it's pretty much just like contract growing... Contract growing pigs, only contract growing acres. Yeah. Pretty much. Yep. Yep.

And you're just beholding to them because they hold the cards. There's no, it's just a flat rate. You're basically a glorified custom farmer except you're funneling, you're handling all the money. Yeah. I would just say also, I think there's a lot, and this is some hope at the end of this question,

I think there's a lot of farmers out there that if they are selling and getting out of the business, that they're not going to sell to a corporation. I know that if I was a guy selling my farm, and I know it's like, oh, it's easier said than done,

you're not sitting in the situation that other farmers are sitting at. I would do my, absolute darnness not to sell to a fucking billionaire or a major investing company. Sometimes it's pretty hard because most of them, they've gotten pretty good at disguising. At disguising, who's actually buying it. But at the end of the day, this is never going to go away. There is always going to be somebody that wants to farm the world and they don't care. basically they don't care what it takes.

They're willing to do it. So you're always going to have that threat, that threat. But I do agree with Sawyer 100% that I think one of the great attributes of the ag community in the United States is our independence, our stubbornness, our independence, are, you know, work harder. But I also understand there's abundance for everybody a little bit. Yeah, and I think we're going to have to work together.

I think at the end of the day, you're going to see, you're going to see farms in an area where you may have two or three farmers that they figure out that we don't need to own three-seven60s. we can probably just own one combine and, you know, farm all our acres. Farm all our acres together. And the other reason for that is because labor is going to get tougher and tougher. Yeah.

So I think you're definitely right. It's definitely a problem. I don't know what you do about it. But if it wasn't that problem, if it wasn't that guy, it'd be something else. It'd be another one. There's always going to be somebody out there that's, trying to work the system no matter what. Yeah, I agree. And yeah, I guess I would just say, if you are a farmer that wants to sell, keep that in mind. Keep that in mind best you can and try

to, you know, weed that out if you don't want to sell to a corporate guy. Because you got to think about not only just yourself, and we talked about this on the last podcast, you know, everybody's at it for themselves nowadays. Thinking about the future of America, think about the future of that ground that you're going to be selling, who do you want to have farm that? A kid that's busting his ass that's a real American that's kind to his community,

that's kind of people, or do you want some, that's in the community that you live in and that you're selling your farm in? You want to sell it to that guy, or do you want to sell it to some corporate guy? I mean, keep that shit in mind. And I think, you know,

if you're somebody selling, put that at the forefront of your mind. And I think if more farmers do that, that's a good thing. It's just like buying American goods, buying 100% American goods. Yeah, the price is probably more that you're going to be paying because like we say, labor or all that in America, it's your end price on the product's going to be higher. But the pride of buying an American made product 100%, I would pay a little bit more for that. And it's the same goes for somebody selling your ground. I mean, it's got to be reasonable. You can't be low ball on the guy, but if you got to sell to somebody, that's going to have the best for your land, the best for the community that you're selling your land in, and it's a stand-up person versus the guy that's going to pay you $3,000 more an acre,

I mean, that's a decision you got to make, but I think that most people would make the decision of, I'm going to sell it to the guy that's good for the community and it's good for the land. I think that's going to wrap it up, guys. That was a good, good, good list of questions. We really appreciate everybody who submitted a question, and feel free to keep sending them, our way. Barn Talk Show at

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