How to Have Self Sustained Lifestyle


Self Sustained Living.  Have a good fulfilling lifestyle… one that is fulfilling and that pays its way whatever happens to prices of basics like shelter and food.

That is what we believe in here at this site and in our lives.  This is why Merri and I enjoy writing and farming.

farms

Merri and I own a farm in North Carolina and this orange grove below in Florida plus we have a 962 acre hacienda in Ecuador that we share with indigenous Ecuadorians (we donated half  to an Andean Shaman and his village).

Our webmaster, son in law and partner, David Cross, has a different approach at his home and farm.  Here is an aerial view.

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When David is not writing or working on our websites or getting his daughters off to school he is farming or canning the tons of food he produces.

This last year he produced  700 lbs pork –  50 lbs pheasant – Fresh eggs – 350 lbs tomatoes – 400lbs potatoes – 20 lbs Swiss chard – 10 lbs carrots, 15lbs beets – 250 lbs apples – 100 lbs zucchini – 50 lbs pears – 10 – lbs turnips – 10 lbs radish – 5 lbs bok choy –  10 lbs cabbage – 5 lbs peas – 50 lbs winter squash – 6 months constant supply of cilantro – 20 lbs blackberries – plus oregano, sage, basil and parsley.

Writing allows us to live as anywhere we choose.

Farming provides a source of income that will always rise with the cost of living… Food is the ultimate wealth… much better than gold!

For those interested in living in Ecuador see the December real estate multi listing here as it includes several Ecuador farm and B&B opportunities (B&Bs offer shelter the other golden form of income along with food).  Click on the Ecuador MLS here.

For those who want a farm in Ecuador but do not want to farm, our friend Jean Marie Butterlin offers a farm service.

How our Ecuador Farm Business Service Works

By Jean Marie Butterlin.

A- Introduction :

We have been studying the Ecuadorian farms for some time now and have found good opportunities for positive returns.  We are investing our own money in Ecuadorian land around Bahia in Manabi Province, where there are multi dimensional opportunity and coastal land is among the best value in the world.

We have assembled a team of experts in agriculture i.e. agri-engineers, business management, sales and marketing, accounting, legal areas, but most importantly we have setup a network of locals in many parts of Manabi, whom we call  “spotters”, that help us find the available properties at the best possible price.  These spotters live within the community and know the history, owner of each property.   They help us to sort out the deed issues and we get the also all the info :   good, bad, i.e. potential problems with water, neighbors, etc.

Our team allows us to minimize the risks associated with farming from knowing all about potential pest problems in an area to the date of last drought or flooding etc.

There is competition.  China is buying big tracks of land to secure enough food production for their own people.  More and more land in Manabi is allocated to making biofuel.

Ecuador has a good RISK/REWARD combination because:

–       land will never go down in price like housing has done in the past; no bubble yet

–       Ecuador law is pro-foreign ownership

–       land is still cheap : $500/hectare ($200 and acre) to $5,000/hectare ($2,000 an acre) depending on water availability.

–       Good labor : qualified and cheap

–       On site management by Ecuadorian experts supervised by a team of business people that have experience in managing businesses.

B- Profit potential in Ecuador Agriculture:

How much can you expect to make in Ecuador agri business?

It depends on 3 factors :

–       price of the land

–       combination of crops

–       quality of management

We have our own team of experts  that work for us. These experts have their own farms and teach at agri-engineers schools.  For example, one of them was born in Israel (Israel knows how to grow food in the desert…) and has managed a 15,000 acre cacao farm in Ecuador.  He now manages his own farms as well as assists us.

Here are the 2 big questions we are always being asked : If the agri-business is so good, why are not more people getting into it and why are most Ecuadorian farmers so poor?

The answer to Question 1 is simple : It is not easy to find good available property, with deeds, etc…. as Ecuadorians hold onto their properties and do not sell easily. That is why I have setup a network of locals that roam the countryside where they live and where they are respected.

The answer to Question 2 is a bit more complex but has a lot to do with access to funding for poor Ecuadorian farmers, as well as business education of these farmers and mostly the famous ” middlemen” that are one of the problems of Ecuadorian agriculture.

There are also a lot of rich Ecuadorian farmers….. and they are making a lot of money even by US standards.

When we talk about management :

•We choose to bring crops to the market at the ideal time of the year when prices are at the highest= timing of the planting.

•We choose crops where there is less competition and lots of demand.

•We choose crops that are ideal for the soil, water and sun.

•We choose crops that have clients ready to purchase before we plant.

•We choose crops that are least disease prone.

•We choose crops that are not too labor intensive.

•We choose crops that have big potential in the future.

•We select a combination of crops for each finca that will maximize income/cash flow and minimize risks.

•We think  “outside the box” = Innovation!

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The net income per hectare is about $2,700. We plant a minimum of 4 ha in a specific area.

Cost of acquisition of the land is about $3,000/ha.

This shows that initial land cost will be paid back in about just over a year.

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Balsawood has a 4 year crop cycle. The wood is very much in demand worldwide as there only a few countries that can produce this kind of wood.

Acquisition cost per ha is about $2,500 on average and can be a hilly type farm.

On a minimum 10 ha farm net income for 4 years is $139,000.

When acquisition cost of the land are deducted total cash flow on a typical 4 year period is : $114,000 and you still own the land.

For a typical $25,000 original land investment and a $17,120 investment in planting and growing (total $42,120) you will get $156,250 gross income fr the sale of the wood for a net cash flow of $114,000.

For the second 4 year cycle, the cash flow will be $139,000 as the land has aleady paid for itself.

We also can elect to farm other short cycle crops like Aji, (the red Pepper) that is sold exclusively to the Tabasco Company. Tabasco pre-buys the whole crop at a fixed price.

Cacao is another longer cycle crop as it takes 4 years to really start harvesting.  The Ecuadorian Cacao has a good reputation and sells well.

Papaya is also a very profitable short cycle crop.

An area that will see a big development is the bio-fuel and bio-diesel.  Ecuador produces already a lot of palm oil but pinon and linseed oil are extremely profitable crops as well.  The whole harvest is also pre-sold to companies that produce bio-fuel.  The price is a linked to the oil market price.

Bamboo production is also a good option on any farm and the Manabi climate is well suited for the constant growth of bamboo production.

3- Cash Flow Management:

In our development strategy, we aim to maximize regular cash flow i.e. combining on specific one fram short cycle crops like plantain or passion fruit and longer cycle crops like balsawood or cacao. This enables to minimize capital outlay to acquisition costs and first year production costs ; income from short term crops will pay for cost of longer cycle crops.

4- Management Package:

We offer a management package that we provide to our clients, who know nothing about agri-business.  It is all based on shared net revenues.

The client invests in a farm that he owns outright himself; minimum is $100,000 in order to have a nice size farm and operating cash flow.

5- Our Vision:

•Chemical free agriculture:

We only use organic and sustainable agriculture.  Organic pest control is a lot cheaper and healthier of course, the key being the ability to monetize the « organic » side of the business.

•Help the local economy and local communities in Ecuador.

6- FAQ:

Why are not more people investing in Ecuador agriculture ?

a) Ecuadorian campesinos are not business people.  They are not entrepreneurs as they lack basic skills outside their trade and they do not have easy access to cheap credit to finance their production costs.  They often prefer a low income lifestyle than high stress work….

b) A lot of Ecuadorian farms are highly successful when run by agriculturally educated people.

c) The big investors are just finding out about how cheap and how fertile Ecaudor land is.

What is the rate of return on the investment ?

On a 10 year average,  a good managed farm can produce between 20 and 30% return.  Cash flow is generated at the end of each crop cycle. This takes into account 2 bad years of production every 10 years, due to unpredictable weather pattern like a strong el niño.

What are you providing?

We provide the following services:

– Selection of the land: with pros and cons

– Selection of the crops for maximum cash flow and lowest risks

– Management of the farm including sales of the crops

What is our business model?

We only make money when our Client/Partner makes money. We take a percentage of gross sales payable only when money is received from the crop buyer.

You can learn more about living in Ecuador and owning an Ecuador farm on an Ecuador farm tour conducted by Jean Marie Butterlin.

See details of three days tours that inspect Ecuador farms and residences below.

Ecuador Agricultural Real Estate Tour

For current Ecuador Agricultural Real Estate information send me a note at gary@garyascott.com

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Ecuador coffee farm entrance.

The original owner spent two years searching for the perfect location to duplicate the exact terrain, altitude and growing conditions of the most successful coffee farms of Boquete, Panama and Columbia.

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Terrain and coffee plants.

After walking with an altimeter in hand and talking to reclusive indigenous farmers, this region was discovered with all the perfect conditions to cultivate exceptional Arabica coffee trees.

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Owners house with roof terrace.

This is a micro climate, blessed with abundant rainfall, in clean mountain air, bounded by a clear trout filled year around rushing river, protected from extremes of wind and large temperature fluctuations,  perfect for growing coffee.

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Open drying patio.

It has 11 hectares planted (manageable for a single owner), with approximately 50,000 Arabica, varietal Caturra (self pollinating) coffee trees which  are perfectly distributed over a hillside interspersed with a variety of fruit trees for shade.

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Oranges grown to protect coffee trees.

No problem selling this crop for top dollar due to its proven high quality.  The coffee sales last year grossed $70,000 so after $25,000 expenses, $45,000 was the net income.

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Coffee beans.

As well, an experimental 1 hectare of Geisha varietal.  Geisha is considered to be one of the finest coffees in the world and garnered the highest auction record in coffee history, fetching $170 per pound in 2010.  The first harvest of this varietal is expected in about 2 years.

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Coffee plants grown in greenhouse on farm.

This Andean  location provides an ideal environment for coffee growing without damaging the unique habitat of many species of birds.   Arabica coffee trees are a major source of oxygen production.  Each hectare produces 86 pounds of oxygen per day which is 50% of rain forest habitat.  Ecuador is a biologically diverse country with an abundance of birds, amphibians, reptiles and butterflies.  Inca Mountain Coffee Farm is ecologically in harmony with its environment.

The Arabica coffee trees are 6 years old, providing remarkable yields, allowing for continuous flowering and two annual harvests (major harvest Feb-Jun and minor harvest Oct-Nov).

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Covered drying patio.

In the yearly Golden Cup competition, coffee from this farm was a finalist in 2011.

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Seasonal worker harvesting coffee.

Owner’s house – 900 sq/ft, 2 bed, 1 bath, with lots of marble, built in cabinets in both bedrooms and upper roof porch

Caretaker’s house – divided into multiple rooms with bathroom

Land line phone installed and operational

110 and 220 volt electric lines

Equipment:  2 coffee bean pulpers with 2 water tanks, 2 weed whackers, misc. tools, scale for weighing coffee bags

1 large uncovered drying patio and 1 covered drying patio

2 full time highly experienced workers – monthly payroll is $650 (plus more during harvest for seasonal workers)

Average yearly expenses:  $25,000 (all payroll, fertilizer, harvesting expenses, utilities, taxes)

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This clean mountain river that runs year around with trout.  Also, access to mountain water for farm irrigation, though it is rarely needed.

Farm is fenced along road.

You can set the date for your own tour.

The Ecuador farm tour fee is $799 for single or  $999 couple.

Case Study #3:   This third case study shows an American who has created a   large Ecuador agri operation. This is the farming operation set up by Young Living Essential oils.

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After creating a marketing system for the oils and farming in the USA, Gary and his wife…

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moved to Ecuador… began a large farming operation as well as…

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there own processing and a health spa.

Ecuador is a perfect place for many types of agriculture… large and small.  Find your farm in the safe and efficient way on an Ecuador Agricultural Tour.

For efficiency and logistics this tour is strictly limited to 15 people… 4 persons per four wheel drive vehicle.

You can set the date for your own tour.

The Ecuador farm tour fee is $799 for single or  $999 couple.

 



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