Investing in the Farms

Investing is something not many people are naturally good at. Some may be able to learn their way through and become successful with their investments while others, no matter how much they try, still cannot make a break. And I personally believe that all of us have failed at some point.

Proposition

Ms. Irene had a challenge a few weeks ago asking what would we do if she'd give me (or you) $5k with the condition that we're going to make an investment, what would we invest the money in?

The first thing that came to mind was what we are doing in real life - financing agricultural endeavors which although a bit risky because prices of vegetables are highly dependable on supply and demand (plus some factors that affect cropping like weather conditions among others), has proven to be profitable in a shorter period.

Of course, we all want to make profits when investing but that's not the main reason why I am choosing agriculture or farming as my place of investment.

So what then?

I believe one of the very basics when making an investment is knowing where you are putting your money into. Whilst we are still learning, we already know the ins and outs of the business - the markets, the processes, or how things are done. We have farm input partners which makes it easier and faster to acquire materials and stuff. We also know channels when it comes to marketing (selling) the produce.

We are doing pretty well and for that, I'm confident that we can do even better with an additional capital inflow. With enough workforce (laborers), harvests and yields can be good (although not 100% guaranteed).

Brief Background

Our province (Cordillera) is a vegetable haven with mountainous terrains rich with agricultural lands. We have a colder climate which keeps our farm produce (referred to as 'highland vegetables') mostly fresh, firm, and crisp.

✅ Huge market

If the stats are still correct, about 80% of the country's vegetable supplies are coming from our region. Some known greenhouses here in the locality provide veggies to the chains of Supermalls, restaurants, and hotels too.

Within the province capital are two large, bustling vegetable trading centers where varieties of farm produce are easily sold each and every day to wholesale buyers from the different markets in the country.

✅ Challenges

Vegetable farming is rather a delicate endeavor if I may say so, and one of the challenges we (and others) are facing now is finding good and diligent farm workers or laborers who treat our investments as their own. There are schedules to follow especially when it comes to the timing of spraying, adding fertilizers, and stuff. Some workers tend to be unconcerned even when their crops are showing signs of problems. A delay in the application of the needed plant nutrients can break a cropping season.

Another is the rising costs of farm inputs. Prices of fertilizers, seeds, disease control, and everything else have doubled and are still increasing, not to mention the operation costs involved.

Also, our country is prone to typhoons, storms, and extreme weather conditions which obviously affect crops. While our region is not susceptible to flooding, strong winds and incessant rains (and even drought) have a great impact on the farm outputs.

✅ Opportunities

Our region is a hub for job opportunities in the agricultural sector (in the farms and in the end market - trading centers).

Migrant workers from other places (mostly from the lowlands and even as far as Mindanao) come here for employment. Without them, we are not sure how our markets and farms here would thrive since we lack local workers.

And while there are challenges (known and unknown), the upside can be a lot more. With the good prices of vegetables this year, most people are enjoying good profits from their investments and labor. In fact, we know several farmers who earned their first millions in these past few months alone. That means their workers also share half of the gains (after all overhead and operating expenses are deducted). Even small-scale farmers are happy.

So if you're asking, is investing in farming or agriculture worth it?

I would say yes. There are risks involved (some are beyond one's control) but the chance of making it big is good. One can get his ROI in a shorter timeframe too.

Personal Thoughts

Farming or agriculture is one of the sectors that make an economy thrive, not to mention it feeds the nation and provides various opportunities to people.

More and more people are realizing the potential of it. Stories of degree holders (professionals) quitting their jobs and turning to agricultural pursuits are common here in the locality, although they are not literally going to the fields and working under the sun but taking advantage of various business opportunities that the farming sector is opening up like providing capital for those who do not have it etcetera.

But while there are tales of successes, there are failed investments too which is normal in any endeavor, so one must be realistic in his/her expectations.