How much can you make per rai?

[SlyAnimal]

An idea which often floats around in my mind, when thinking about living in Thailand long term, is to invest in land and farm it.

At present I have property in NZ, but it would sorta make sense, particularly once I have kids who are Thai citizens, to insulate my family against currency fluctuations etc by investing in Thailand.

But I don't have any idea on whether it'd actually be profitable or not. I more know property rather than farming, but property investments here seem to have low % net returns compared to NZ.

What I'm looking for is a bit of general advice, to give me an idea on what to research further (or to see if it's even worth researching).

What would be the crops or animals which would potentially yield the biggest profits in Southern Roiet? And if you have any estimates on how much I might be able to make, either net or gross, per Rai that'd be awesome

[harrry]

Anything you can make a proper return growing on in Thailand is illegal and that is just how those at the top like it.

[David48]

Mate ... ignoring that fact that you are a KIWI (Eden Park ... grumble, grumble!) ... you are still a Mod ... so you get a bit of special attention ...

I went to the Isaan Farmers Meeting earlier this year. Experienced Farmers there, many before they came to Thailand.

To a Man ... almost no-one was turning a profit. Some were close though.

If you hold marginal land, Rubber might be a go ... can prices stay depressed for long times?

Pigs are turning a profit apparently ATM.

In addition to the pinned topics above ... here is some selected reading from over the years ...

-farming-greenhorns-tips-for-surviving-the-early-years

* -farming-experience

-how-much-land

-becoming-a-farmer-in-thailand

-making-big-money-with-only-5-rai-and-rainfed

-tobacco-farming

-my-experience-with-teak

-sugar-cane-investment

-rice-yield-per-rai

-fish-farm-a-good-venture-or-not

... and if you wanted to know about fish ... -fish-farms-201

From outside the box ... -farming-ideas-that-never-grew

http://www.thaivisa.com/forum/topic/720187-becoming-a-farmer-in-thailand/

[SlyAnimal]

Hmm ok if farming is struggling to even turn a profit, it's probably not going to give the returns on investment I'd expect.

I was thinking that there would be some Farang farmers making decent money (21k net per Rai each year, if employing all workers on 300k per Rai land, would be about a 7% return which would be enough to warrant further research).

As yeah, I figured since we're not bound by tradition, have an international perspective, capital and knowledge of modern farming techniques, that Farang would be doing quite well (so might have some farms returning 10%+ net).

Edit: I might read some of those threads a bit more over the next few days. As some of them look like they might be making decent money.

[David48]

I got a postcard from a mate who's enjoying a Holiday ATM.

This year 5 Million Rai of rubber in countries from W Africa to Southern China is now being tapped. The government are trying to help, but the guys in the rubber forum are not having high expectations.

So, even rubber's outlook does not look that good.

Edited August 28, 2014 by David48

[soidog2]

It is not all gloom and doom, it is possible to average 15-20% return on investment, your main problem will be acquiring land.

Today's land prices are scary, going to 100.000.00 baht per rai for decent agricultural land.

[wayned]

It would depend on the location,the crop and whether you intend to work the land yourself which is an illegal occupation, but many do it. If you intend to hire everything out that's an added cost. The other thing that enters into the equation is ROI. How long are you going to amortize the cost of the equipment and structures that you buy/build? Most Thais ignore the costs and any profit ends up being how much money they put in their pockets after they harvest the crop. We grow corn and sugar cane. Although the yield/rai this year is down, the selling price is up and we get about 6000 - 7000 baht/rai delivered to the buyer, but that's money in our pocket when we sell it and not net.

My wife tells me that the land around us has shot up to 300k/rai recently. That's whey most of the farm land around us still belongs to the government and is rented, I think that we still pay 700 baht/rai/year.

[pizzachang]

The age-old problem....once food prices reach a point where real profits can be realized, then it may be too expensive for local consumption. Exports of food and other commodities are government controlled.

[misterphil]

My wife has several plots of land in Saraburi. One of the plots is 4 rai which is a rice farm. She rents out the 4 rai of rice farm for 8,000 baht a year. The income is so little, she employs her grandfather to collect the rent for her. And guess how much he gets for collecting the rent? 8,000 baht a year. She lets him keep the rent for some beer money and maybe a little lady once in a while.

Good luck.

[Daniel Boon]

The better idea is to consider what to grow ( crop, flock or stock) ...by understanding demand ...

Prime land isn't totally necessary for some of these ... Lower inputs allows lower sale prices ...

[shirtless]

Keep your investments in NZ , as i would rather worry about currency fluctuations , Farming in Thailand has many pitfalls , ie crackdown on Thai nominee companies, when i went to Essan i didnt see many farmers driving mercs.

[seancbk]

SlyAnimal,

Do some research into growing (breeding) various bugs. Thailand climate is ideal and the amount of space required / startup costs would be minimal.

Here are some links to get you started.

http://www.insectsarefood.com/what_is_entomophagy.html

http://en.wikipedia.org/wiki/Insect_farming

Here is one from just 3 days ago -

http://www.washingtonpost.com/world/asia_pacific/edible-insects-a-boon-to-thailands-farmers/2014/08/25/6df7ea94-2c22-11e4-be9e-60cc44c01e7f_story.html

There are some threads on this forum you should search for too.

Best of luck.

[seancbk]

Found a thread on insect farming - http://www.thaivisa.com/forum/topic/660575-insect-farming/

[empireboy]

Hmm ok if farming is struggling to even turn a profit, it's probably not going to give the returns on investment I'd expect.

I was thinking that there would be some Farang farmers making decent money (21k net per Rai each year, if employing all workers on 300k per Rai land, would be about a 7% return which would be enough to warrant further research).

As yeah, I figured since we're not bound by tradition, have an international perspective, capital and knowledge of modern farming techniques, that Farang would be doing quite well (so might have some farms returning 10%+ net).

Edit: I might read some of those threads a bit more over the next few days. As some of them look like they might be making decent money.

Have you / would you consider Aquaponics? It's a globally evolving growth trend and if done commercially I think is more profitable than many traditional forms of farming and with other obvious environmental benefits. Just a thought... there's a plethora of information out there on it.

[thaiguzzi]

My wife has several plots of land in Saraburi. One of the plots is 4 rai which is a rice farm. She rents out the 4 rai of rice farm for 8,000 baht a year. The income is so little, she employs her grandfather to collect the rent for her. And guess how much he gets for collecting the rent? 8,000 baht a year. She lets him keep the rent for some beer money and maybe a little lady once in a while.

Good luck.

Misterphil - beautiful avatar. I love my Dobermans.

[David48]

My wife has several plots of land in Saraburi. One of the plots is 4 rai which is a rice farm. She rents out the 4 rai of rice farm for 8,000 baht a year. The income is so little, she employs her grandfather to collect the rent for her. And guess how much he gets for collecting the rent? 8,000 baht a year. She lets him keep the rent for some beer money and maybe a little lady once in a while.

Good luck.

I read that and that made me smile.

Still smiling.

"she employs her grandfather to collect the rent ... She lets him keep the rent for some beer money and maybe a little lady once in a while." ...

[VINCENT2012]

An idea which often floats around in my mind, when thinking about living in Thailand long term, is to invest in land and farm it.

1) you are not allowed to buy land in thailand.

2) without a work permit u can not work, and farming is not for us.

3) as an investment today this idea cant be worse....to me of course!

4) if you do , do everything legaly and be carefull of all the crabs who are going to tell you, there is no probleme here and there and that you can do it this way or that way.....you could regret it one day and loose quiet a lot of money too.

5) living here long term and get a long term visa, wich one ?????? i dont know this one!

so relax ....have some and think about all this before you put some money here.

ps:by the way if you want to invest here why dont you buy my wife's resort...? contact me, it will be a pleasure

http://www.hotel-resort-for-sale-ubon-ratchathani.sitew.eu

[Kasset Tak]

Hmm ok if farming is struggling to even turn a profit, it's probably not going to give the returns on investment I'd expect.

I was thinking that there would be some Farang farmers making decent money (21k net per Rai each year, if employing all workers on 300k per Rai land, would be about a 7% return which would be enough to warrant further research).

As yeah, I figured since we're not bound by tradition, have an international perspective, capital and knowledge of modern farming techniques, that Farang would be doing quite well (so might have some farms returning 10%+ net).

Edit: I might read some of those threads a bit more over the next few days. As some of them look like they might be making decent money.

Have you / would you consider Aquaponics? It's a globally evolving growth trend and if done commercially I think is more profitable than many traditional forms of farming and with other obvious environmental benefits. Just a thought... there's a plethora of information out there on it.

Agricultural colleges here in Thailand have what they call Aquaponic and Hydroponic. They teach the concept and technique to use it to the students and sell what they grow to try to raise money for projects and so on. In the college that I currently work they had a B 50,000 loss last year and B 40,000 the year before on their hydroponic plant!

[Issangeorge]

An idea which often floats around in my mind, when thinking about living in Thailand long term, is to invest in land and farm it.

1) you are not allowed to buy land in thailand.

2) without a work permit u can not work, and farming is not for us.

3) as an investment today this idea cant be worse....to me of course!

4) if you do , do everything legaly and be carefull of all the crabs who are going to tell you, there is no probleme here and there and that you can do it this way or that way.....you could regret it one day and loose quiet a lot of money too.

5) living here long term and get a long term visa, wich one ?????? i dont know this one!

so relax ....have some and think about all this before you put some money here.

ps:by the way if you want to invest here why dont you buy my wife's resort...? contact me, it will be a pleasure

http://www.hotel-resort-for-sale-ubon-ratchathani.sitew.eu

His children will be Thai citizens, so they can own the land, he wants an investment, so probably won't be working the land. The way I look at farming here is don't even think of a return on your land until you sell it, and then you will get the capital gain. If you look at it that way and contract out the side of farming that involves equipment, the plowing etc. Then you can get by with little capital investment, other than the land and perhaps make a buck or two. Think of the land as an investment for your kids, not you.

[khunPer]

»What I'm looking for is a bit of general advice, to give me an idea on what to research further (or to see if it's even worth researching).«

I’ve bought some farmland up Surin – or rather a plot my daughter; a plot in company name; and my GF bought some plots. Look at it as a long-term investment merely than a going business.

If you want to farm the land yourself what to “grow” is depending of what you can sell in the area, meaning growing corn is no use, if there is no wholesaler buying it. It may often be a choice down to rice, cassava (for bio ethanol) or sugar cane (Roiet is not that far from Surin).

You shall consider the investment and the running costs compared to the outcome:

Source The Nation 31-03-2008:

Production cost 1 Rai EQ 7,000 to 8,000 baht (07/08) (total incl. fertilizer)

Earlier: 3-4,000 baht.

1 Rai produce average 600-700 kg (white) rice

- - - -

Source Thai PBS 2014-07-22:

BANGKOK: -- Thai farmers are the poorest among other farmers in Asean countries with their net profit after rice sales falling to 1,555.97 baht/ton.

It said production cost/ton of rice paid by Thai farmers is 9,763.40 baht while rice harvest yields 450 kilogrammes per rai.

They obtained 11,319.37 baht/ton from rice sale. After cost deduction Thai farmers earned just 1,555.97 baht as net profit from a ton of rice sold...

[sic]

Sugar Cane lasts for 3 years, but the first year you will not make a profit, perhaps even a loss. Cassava seems to be the crop with least labor involved, but if it’s raining a lot it may cause bad quality and low price.

Planting rubber can be a good long-term investment, but the first 7 seven years you will have no outcome, only expenses taking good care of the baby-trees. Some grow for example beans between the rows of small rubber trees the first few years to make some profit, but that’s also a lot of work. When you can cut the trees it seems like an outcome of around 10k a year per rai, but you will need workers to cut, collect and prepare the rubber. A possibility is to share with someone already growing rubber, so they do the cutting on a split deal, often 40/60, so you will get 60 percent of the rubber sheets to sell yourself.

That’s what I know from family and land in Surin, perhaps some other members can give better advice.

I have no knowledge about keeping animals or having fish farming, but I know some farangs from the local Surin area has lost (lots of) money on that experiment, pigs and fish, without knowing the reason for what went wrong.

If you compare with initial investment in buying farmland, the outcome is often lower than a bank interest rate. If you lease out the land and let others do the farming, which lift you from the burden with labor, machines and administration (rice farming is by the way reserved for Thais), your outcome will be around 500 baht per rai per year in average. Often it’s a share in the harvest, some years little better, other years little lower. You will probably end up with the same (or less) net if you do the farming yourself. If you compare that to the investment in buying the land, for example 30k baht/rai, you will have between 1,5 and 2 percent “interest” of your investment.

When I say buying farmland shall be looked at as a long-term investment that is the rise in land price, and if that in average minimum doubles each 10-year period, it is a fairly good investment on top of a small interest. However you cannot own the land as a foreigner, has to be in a company and taxed, or owned by wife/GF/family with whatever risks that may involve. If you buy land in company name that need to be Chanute title on the deed and often the price is higher for Chanute title, in Surin area at the moment 60k to 100k per rai, which reduce the annual interest to less than 1 percent, more likely around 0.5 percent. Also bare in mind, that it may take (long) time to sell land and get paid, when you finally wish to cash in on your investment.

Wish you good luck with your plans.

[hotsoup]

I need glasses. I though your post said: How much can you make per rat. Well on the CM-BKK highway evidently a Baht or two!

[whiteman]

Just get your wife to buy one rai with your money that people will buy off you later to build there house on. Just keep it clear and clean and watch the people walk all over it thinking I could build my house here I wounder how much? Make sure there is a sign on it with your contact number and also make sure you check the sign ever week to make sure no dick head has smashed it up. Good luck.

Edited August 29, 2014 by whiteman

[rice555]

Hmm ok if farming is struggling to even turn a profit, it's probably not going to give the returns on investment I'd expect.

I was thinking that there would be some Farang farmers making decent money (21k net per Rai each year, if employing all workers on 300k per Rai land, would be about a 7% return which would be enough to warrant further research).

As yeah, I figured since we're not bound by tradition, have an international perspective, capital and knowledge of modern farming techniques, that Farang would be doing quite well (so might have some farms returning 10%+ net).

Edit: I might read some of those threads a bit more over the next few days. As some of them look like they might be making decent money.

Have you / would you consider Aquaponics? It's a globally evolving growth trend and if done commercially I think is more profitable than many traditional forms of farming and with other obvious environmental benefits. Just a thought... there's a plethora of information out there on it.

Agricultural colleges here in Thailand have what they call Aquaponic and Hydroponic. They teach the concept and technique to use it to the students and sell what they grow to try to raise money for projects and so on. In the college that I currently work they had a B 50,000 loss last year and B 40,000 the year before on their hydroponic plant!

What School?

rice555

[SlyAnimal]

Thanks everyone for your advice.

From the sounds most crops/animals provide a lower return on investment than what I'm currently making via renting properties in NZ, so it's probably not worth moving money out of NZ and into farming.

Particularly as I have a principal of not relying on capital gains (which seems like it's the most lucrative thing about farming) and of valuing property by it's expected % net return on investment, rather than it's market value. This way of thinking potentially costs me some opportunities to make good money, but also helps me avoid risk (and it helps with keeping emotion out of what should be a business decision).

[Greg Nixon]

Buy raw land next to a large city and lovely housing development or commercial land along the highway. The people ( Ma and pa ) who owned the Big C property in Mukdahan purportedly made a handsome profit. Wait and wait and wait - perhaps 20 years.

[David48]

Thanks everyone for your advice.

From the sounds most crops/animals provide a lower return on investment than what I'm currently making via renting properties in NZ, so it's probably not worth moving money out of NZ and into farming.

Particularly as I have a principal of not relying on capital gains (which seems like it's the most lucrative thing about farming) and of valuing property by it's expected % net return on investment, rather than it's market value. This way of thinking potentially costs me some opportunities to make good money, but also helps me avoid risk (and it helps with keeping emotion out of what should be a business decision).

Mate, I'll take the Thai Farming hat off and don the thing I have more experience in ... Property.

In Australia and I presume NZ, there seems to be a large amount of available land which is priced for the highest and best use of that land.

In our relative countries ... you could go into a Farming community, look at the available licences, water rights, fencing, soil profile, usual weather pattens, condition of the fencing (if applicable), value the plant and equipment ... and you get a fair idea of the value of that farm ... even if the land is leasehold.

In Thailand, land title varies, but the # 1 variable that makes much of Farming uneconomical is the fact that land is not being valued for it agricultural use but more a property speculation.

So, to buy an acreage Farm, look to produce something and get a reasonable ROE is neigh on impossible here.

One example is my gf's Parents Farm.

A eight Rai plot is on offer ... circa Bt 4 million (we aren't that far out of Bangkok) ... to rent that land, which the gf's Father does ... the annual rent is Bt 20,000 ... that's a ROE of 0.5%.

Not saying you can't do it ... but I believe there are smarter ways to make money.

.

.

[farmerjo]

The op is sort of on the right track,but its not in farming itself.

The next step up to middleman farming business is where the real gains are made.

Buying,storing,selling,transporting.

[SlyAnimal]

Yeah that's essentially what I gathered when I was looking to buy some land to build a house on. Every piece of land close to a road, even down small side streets, were priced at rates which would require some very intensive use of the land to return even a small RoI.

Everyone was doing it though, even land out of town, about 3km from the next closest building, was 3M per Rai because it was next to the main road. I really did feel like they were trying to hold development at ransom by colluding on their prices. Some of them would be living in stick houses, yet have 5M worth of vacant land, but not be prepared to sell for it for anything less than 10M

Which is why I ended up forgoing the large section & dream house I wanted, to instead knock down my wife's existing house and build another similar (but much nicer) house.

I figured that maybe farmland would be more viable if buying a large tract of land. As the land with road access is expensive, but the land behind it is relatively cheap (since the owners realize they'll never convince anyone it's useful as anything but farmland).

But oh well, it was worth enquiring about farming anyway. I've got a few other ideas which I'm considering for investments here (Although likewise need to see if they'll end up viable or not).

[misterphil]

My wife has several plots of land in Saraburi. One of the plots is 4 rai which is a rice farm. She rents out the 4 rai of rice farm for 8,000 baht a year. The income is so little, she employs her grandfather to collect the rent for her. And guess how much he gets for collecting the rent? 8,000 baht a year. She lets him keep the rent for some beer money and maybe a little lady once in a while.

Good luck.

Misterphil - beautiful avatar. I love my Dobermans.

Thank you, she was only 1 year old in that photo. She's 3 now and a lot bigger. How many do you have? Male, female? We are looking to get a male at the beginning of the year.

[Issangeorge]

»What I'm looking for is a bit of general advice, to give me an idea on what to research further (or to see if it's even worth researching).«

I’ve bought some farmland up Surin – or rather a plot my daughter; a plot in company name; and my GF bought some plots. Look at it as a long-term investment merely than a going business.

If you want to farm the land yourself what to “grow” is depending of what you can sell in the area, meaning growing corn is no use, if there is no wholesaler buying it. It may often be a choice down to rice, cassava (for bio ethanol) or sugar cane (Roiet is not that far from Surin).

You shall consider the investment and the running costs compared to the outcome:

Source The Nation 31-03-2008:

Production cost 1 Rai EQ 7,000 to 8,000 baht (07/08) (total incl. fertilizer)

Earlier: 3-4,000 baht.

1 Rai produce average 600-700 kg (white) rice

- - - -

Source Thai PBS 2014-07-22:

BANGKOK: -- Thai farmers are the poorest among other farmers in Asean countries with their net profit after rice sales falling to 1,555.97 baht/ton.

It said production cost/ton of rice paid by Thai farmers is 9,763.40 baht while rice harvest yields 450 kilogrammes per rai.

They obtained 11,319.37 baht/ton from rice sale. After cost deduction Thai farmers earned just 1,555.97 baht as net profit from a ton of rice sold...

[sic]

Sugar Cane lasts for 3 years, but the first year you will not make a profit, perhaps even a loss. Cassava seems to be the crop with least labor involved, but if it’s raining a lot it may cause bad quality and low price.

Planting rubber can be a good long-term investment, but the first 7 seven years you will have no outcome, only expenses taking good care of the baby-trees. Some grow for example beans between the rows of small rubber trees the first few years to make some profit, but that’s also a lot of work. When you can cut the trees it seems like an outcome of around 10k a year per rai, but you will need workers to cut, collect and prepare the rubber. A possibility is to share with someone already growing rubber, so they do the cutting on a split deal, often 40/60, so you will get 60 percent of the rubber sheets to sell yourself.

That’s what I know from family and land in Surin, perhaps some other members can give better advice.

I have no knowledge about keeping animals or having fish farming, but I know some farangs from the local Surin area has lost (lots of) money on that experiment, pigs and fish, without knowing the reason for what went wrong.

If you compare with initial investment in buying farmland, the outcome is often lower than a bank interest rate. If you lease out the land and let others do the farming, which lift you from the burden with labor, machines and administration (rice farming is by the way reserved for Thais), your outcome will be around 500 baht per rai per year in average. Often it’s a share in the harvest, some years little better, other years little lower. You will probably end up with the same (or less) net if you do the farming yourself. If you compare that to the investment in buying the land, for example 30k baht/rai, you will have between 1,5 and 2 percent “interest” of your investment.

When I say buying farmland shall be looked at as a long-term investment that is the rise in land price, and if that in average minimum doubles each 10-year period, it is a fairly good investment on top of a small interest. However you cannot own the land as a foreigner, has to be in a company and taxed, or owned by wife/GF/family with whatever risks that may involve. If you buy land in company name that need to be Chanute title on the deed and often the price is higher for Chanute title, in Surin area at the moment 60k to 100k per rai, which reduce the annual interest to less than 1 percent, more likely around 0.5 percent. Also bare in mind, that it may take (long) time to sell land and get paid, when you finally wish to cash in on your investment.

Wish you good luck with your plans.

450 kilograms per rai at an income of 11,319.37, that works out to 25.15 per kilogram, where were they getting a price like that, even under the rice scheme they weren't pay prices like that. There is a guy on this forum, I believe his name is Michael Harris. He lives in Ubon and buys seed crops, and suggests there is big money to be made from them. True or not, I don't know.