Equity averages 3.91 million yen! How much is the initial investment in agriculture? What’s your purpose?

Equity averages 3.91 million yen! How much is the initial investment in agriculture? What's your purpose?

When you decide to start farming, you care about money. Not only cultivated land, but also machinery such as tractors and light tigers, seedlings, fertilizer, water and fuel costs. I think a lot of people don’t know how much money it will cost to start raising. The first thing that comes first is money.
Hence, we will cover the amount needed to start farming, how to keep prices low and systems like subsidies.

Let’s start planting! How much does it cost?

The average equity capital is 3.91 million yen

According to the “2016 Survey Results on New Farmers ‘Farming Conditions” conducted by the National Center for New Farmers’ Advice for New Farmers nationwide, the average out-of-pocket amount is standardized by new farmers. costs 2.32 million yen for cultivation. In terms of living, the average is 1.59 million yen, and the total averages 3.91 million yen. As a result, the average amount spent on farming such as capital investment and fuel for seedlings is 5.69 million yen. (* first)

The cost of living is expected to be about 1 to 2 years

The first year of farming, until harvest, there is no income. Even if the harvest is successful, it cannot sell or take time to make money. The average amount the senior farmer prepares for living expenses in the first year is 1.59 million yen. Among the new farmers, 24.5% answered that their livelihood mainly comes from agricultural income. In terms of future livelihood prospects, 76.4% of respondents answered that “prospects will be established in the first and second year of farming”. Funding for new farming varies depending on the existence of a family and the crops to be farmed, but sufficient reserves are required to survive even with no income for one to two years after starting work. shallow.

Number of cultivation funds required annually

The average amount of “farming funds” required to operate agriculture, such as fertilizers and seedlings, fertilizer and fuel, and transportation costs, is 1.58 million yen in the first year. This is an annual expense as long as you keep farming. You can refer to the “Agricultural Management Index” published by each province to see what kind of costs will be expensive. It is published in detail for each work, so let’s check the index of the desired work.

Cost of buying agricultural land needs attention Initial investment cost

It is better to rent farmland

This is an absolutely essential farmland to start farming, but if you’re new to farming, you’d better rent it than buy it. The national average rent for agricultural land in 2013 was around 10,778 yen for paddy fields and 5,562 yen for fields (* 2) per 10 ares. You may feel that it’s cheaper than you expected.

In addition, in order to lease agricultural land, it is advisable to consult the agricultural committee of each city to regulate the use of agricultural land. The agricultural land intermediate management organization (* 3) of each province announced the recruitment situation for agricultural land lease expansion. In addition, you can browse information about the land registered as a desired lease on the Internet in the national agricultural land navigation (* 4).

How to reduce investment capital to about 60%

The large expenditure associated with new cultivation is the cost of buying machinery and vehicles such as trucks and lawn mowers. The average amount is 4.11 million yen. The investment amount varies widely depending on the season, but the first tractor that many farmers buy is 1.8 million yen if it is new, and can go up to 10 million yen or more (* 5). In addition, need to prepare the necessary machinery and means according to the season such as rice transplanters, combine machines, canvas houses, light trucks for transportation, … and purchasing costs are the first issue for those who want to start farming. By the way.

It can be said that the initial investment amount will vary depending on how the cost of this equipment is reduced. One way is to use the local government subsidy system. For example, in Sakura City, Chiba Prefecture, we have a system to assist in the purchase of agricultural machinery and materials for new farmers (* 6). It is best to consult with your local government office about the planned farming area.

In addition, you can use the same machine in the area, or you can do it manually without using the machine.

Work can start with a small amount

Initial cost varies greatly depending on the job

Another way to reduce investment is to first consider carefully the form of farming, ie “what to do”. If you are not interested in land and crops and want to start growing with less money, you can choose a crop that requires less initial investment. Here, let us consider the equipment required for each typical crop and its purchasing costs. All of the following acquisition costs are based on the National New Farmer’s “New Farmer Condition Survey 2016”.

The initial investment more than doubled between the field vegetables and the base vegetables

Outdoor vegetables … 3.19 million yen on average

Outdoor vegetables such as cucumbers, eggplants, cabbage, hakusai, daikon, lettuce, edamame and broccoli, which require little initial investment, are also popular with new farmers. Since yield is dependent on the weather, you can avoid the risk by planting multiple crops at different times. If you start with growing vegetables on the bare land and invest capital like a plastic net house, you will be able to cultivate in the winter, not easily affected by weather so profits will be stable.

Vegetables … Average 8.26 million yen

In addition to tomatoes, onions, peppers, and shishito, melons and strawberries are also classified as “base vegetables”. Being unaffected by the weather, can be cultivated all year round, resulting in stable profits. However, setting up a vinyl house and maintaining a greenhouse is essential and the initial investment amount is sure to be high. Costs that do not arise on field vegetables, such as the cost of materials such as vinyl and the cost of electricity and utilities, should be calculated in advance.

Rice … Average 5.56 million yen

In addition to the tractor, there are also many necessary equipment such as rice transplanters, combine machines, dryers, if having a complete set, it is very expensive. On the other hand, rice harvested once a year, the damage caused by weather changes is so great that the number of farmers working in the whole crop is decreasing every year. It is a major hurdle for an individual to start farming as a full-time rice farmer from the point of view of equipment, and the fact that starting agriculture to inherit or inherit business.

Not only pay attention to the initial investment but also the difference in the cost per year

Fruit trees … 3.6 million yen on average

Fruits such as grapes, peaches, cherries, and ume have a modest initial investment, but the time of harvest is a problem. It takes 3 to 8 years from planting sirop to harvest fruit. Very few new farmers try to grow fruit trees from scratch, and they often take over from their parents or start farming by inheriting their businesses. Another option is to find a farmland where you can rent entire fruit trees.

Hoa … Average 7.63 million yen

Growing flowers such as rose, kiku, and carnation requires initial investment for the facility. In addition, utility costs and transportation costs tend to be high. The cost per year is more than double the average for field vegetables. Accordingly, profitability tends to be high.

Agricultural financing modality for people with little equity capital

Make good use of benefits and benefits

Many senior farmers who started farming overcame financial barriers by not only using their own capital, but also local government subsidies and benefits. The “Farmers Support Fund” allows you to take interest-free loans and the “Next Generation Agricultural Manpower Investment Fund (New Generation Farmers Fund)” allows you to receive a grant of 1.5 million yen (* 7) per year for up to 5 years if certain conditions are met. ) “And such.

(* 1) National Center for Agricultural Consulting Results of 2016 Survey on New Farmer Conditions “(* 2) Ministry of Agriculture, Forestry and Fisheries “Price and rental of cultivated land” http://www.maff.go.jp/kyusyu/toukei/database/pdf/2-8-1_nouti_kenri_tika25.pdf(* 3) Institutional management of agricultural land intermediaries http://www.maff.go.jp/j/keiei/koukai/kikou/kikou_ichran.html(* 4) Nationally navigate agricultural land https://www.alis-ac.jp/SelectPre Prefecture(* 5) Refer to the price of tractors https://www.jnouki.kubota.co.jp/product/tractor/(* 6) Sakura City New Farmer Support Project, Chiba Prefecture http://www.city.sakura.lg.jp/0000013749.html(* 7) Ministry of Agriculture, Forestry and Fisheries New Generation Human Resource Investment Fund http://www.maff.go.jp/j/new_farmer/n_syunou/roudou.html

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