Thursday, March 31, 2011

A Fork in the Family Farm Road

The maternal side of my husband’s family (the Buchholz side of the Bailey/Buchholz family tree) owns an active farm in Melvin, Illinois, a small town about 40 miles north of Champaign-Urbana. Ron’s grandfather, Ronald Buchholz, retired some 30 years ago, and the land is sharecropped by 2 other local farmers on behalf of the estate. None of Ron’s generation are farmers and no one is planning to retire to Melvin. We’ve come to a fork in the road in regard to stewardship of the family farm, and it’s time to think about selling.

Childhood memories of family visits and countless holidays celebrated inside the walls of the old farm house make this decision a complicated and emotional one for Ron and his siblings. Generations of Buchholz have called this place home since the mid-1800’s, and family farmers and merchants were pillars of the small community. Sadly, circumstances change. A sale won’t rewrite past history, but it will irrevocably sever ongoing practical ties to Melvin – a step that will be taken with regret.

On Tuesday, Ron and I attended an auction of some nearby farm land, as observers. It was a reconnaissance mission. Our goal was to assess the level of interest in available land near Melvin, and to witness at what price it would sell. We made the two hour drive from Chicago to the Elliott AMVETS Hall (about 10 miles south of Melvin) in time to grab a cup of coffee and find a seat.

The auction began after a description of the 60 acres for sale. It was obvious that the majority of the approximately 80 locals in the room were merely interested observers, including farmers, bankers, investors, land brokers, and (I think) a few veterans just waiting for the kitchen to open for lunch. The auctioneer opened bidding at $7,000/acre, but there were no bids at that price. The first bid was made at $5,100, but with 3 bidders very quickly rose to $6,800 before the auctioneer called for a brief break. A 4th bidder jumped into the fray at $7,350. The 60 acres sold for $7,450/acre, a total of $447,000, to farmers from nearby Paxton (a man and his grown grandson). There was much handshaking and back-slapping in congratulations, as people left the hall.

Commodities (including corn and soybeans) are hot right now in the financial markets. Last year’s crop yields were high. The value of farm land has been increasing. The Buchholz acreage is desirable and will probably sell for more than the land that was auctioned Tuesday. If we decide to move forward, our next step would be to retain a broker to put together options for structuring a sale.

Selling the farm will notably enhance the financial security of the current generation. I like to think that all those practically-minded German ancestors that worked so hard and invested in the future of the family would understand and approve.

1 comment:

  1. One can only move forward, never move back. I often remember the old days but I know that I could never return to them and the rat race. To be sure, I still have many great memories (and some not so great) but in my heart of hearts I know there is no returning; so, I only look forward now and I am happy with that!