Is this land that is being bought for future subdivisions? Definitely have seen this in areas by suburban areas. Certainly not all farming is being done at a loss?
Farming is a lot like a startup, except maybe drawn out over more years than tech people like to see.
You invest everything you have into a business that will return you very little, at least in the start. As you start to grow you put your profits into growth. Finally, as you reach retirement age the debts are hopefully paid off and you are actually making money for the first time. You're also sitting on millions of dollars worth of assets that are now fully in your name. When you are ready to retire, you sell it all.
In other words: You live in poverty over your working career so that you can cash out later in life, while hopefully not going bust in the meantime. The profitability of the business is dependant on the market and the weather, but even more dependant on what stage your business is at. Early stage businesses are apt to lose money most years, but late stage businesses should make money most years.
This sounds like you are describing what has occurred for farmers who started 30 or 40 years ago and are retiring now. I assume most farmers who retired decades ago weren't sitting on millions; certainly my grandfather wasn't.
> Certainly not all farming is being done at a loss?
A big corp can calculate differently from your small farmers. It's OK to them if the field turns profitable finally in 20 or 30 years because they have enough other sources of income to pay for the mortgage (or buy the field out of pocket).
The small farmer on the other hand would be bankrupt by then.
No, no development anywhere around. I'm not sure why the price went up. I bought my land in the 90's and it was ~$1000/acre. Now its 10X that. Probably a bubble.
