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Can i make any money farming cows in South Australia
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<blockquote data-quote="SouthOz" data-source="post: 130966" data-attributes="member: 2514"><p>Hi Wannabe,</p><p>I run a few cattle down the road a bit from Meadows in South Australia and I thought I would have a go (in my first post) at giving a local perspective on some of your questions.</p><p></p><p>The short answer to your question is that probably you can't make any more money from running cattle in South Australia including Meadows than anywhere else. The return estimates that I have seen on this board relating to the US unfortunately appear to be around the mark for how things are in this part of the world. </p><p></p><p>Meadows is within commuting distance to Adelaide (the capital of SA), has good rainfall and is very pretty country. The demand for lifestyle blocks of 100 acres is high and the price of these blocks far exceeds their agricultural value. This is the reason Meadows is $5000 an acre. Penola on the other hand is down South, less rainfall and not as pretty and you won't be living next-door to a surgeon. In Penola, in general, land prices will be more closely tied to their agricultural value – and that is why Penola is $800 an acre. Strictly in terms of cattle returns for outlay Penola is the better bet because you can buy more feed per $ in Penola compared to Meadows. But future capital gains are likely to be higher in Meadows and the lifestyle type place (near amenities – hospitals – good schools – shops etc) appeals to many people. So you are looking at two very different types of operation and which one is best for you only you would know. </p><p></p><p>But using your 100 acre Meadows block as a hypothetical case off the top of my head some ball park maths might look like this. Pick up 30 young black Angus cows – preg tested in calf. $32,000. Get 28 calves on the ground. Wean at 7 months at 250kg. At the moment prices are good – $1.80 kg live weight for heifers – $2.20 for steers. So assuming a 50/50 boy girl split returns approximately $13,000. This is really a maximum best case scenario and most years running an operation a bit larger than this I would not have achieved this return. Subtract costs: fertilizer for 100 acres say $2,000, hay making 100 bales – another $2,000, general fencing and odds and sods say another $3000. So your left with $6000 profit or $200 a head which is on the high side because I haven't factored everything in right and prices are high here at the moment. This is all just ball park remember!</p><p></p><p>In respect to what breeds are best – black / red Angus are getting more dominant in the area – and receive good prices from feedlotters. Not many people finish cattle themselves – the feedlot business here is pretty specialised and you really need a lazy million or two to get off the ground, good knowledge of the industry and it is probably a risky way to get started on cattle. Just out of interest I can report the local topic of conversation around here lately is the new electronic tagging of cattle we all have to do for the national database - which has created some very polarised views - but thats another topic in itself! </p><p></p><p>I'm sorry if this all disappoints. But I will say as a plug for this part of the world that on the weekend (Sunday anyway) the weather was glorious – the grass was jumping out of the ground – our cattle are all doing well – the calves are growing – our children are being raised in an idyllic setting – our neighbours and our little local community are great to be a part of – and I wouldn't have traded places with anyone. What better return from cattle can you get than that! </p><p></p><p>Very much enjoy the board – have improved a couple of aspects of our little operation as result of things I've gleaned here and hope to make the odd contribution when I can think of something sensible to say. Regards SouthOz.</p></blockquote><p></p>
[QUOTE="SouthOz, post: 130966, member: 2514"] Hi Wannabe, I run a few cattle down the road a bit from Meadows in South Australia and I thought I would have a go (in my first post) at giving a local perspective on some of your questions. The short answer to your question is that probably you can’t make any more money from running cattle in South Australia including Meadows than anywhere else. The return estimates that I have seen on this board relating to the US unfortunately appear to be around the mark for how things are in this part of the world. Meadows is within commuting distance to Adelaide (the capital of SA), has good rainfall and is very pretty country. The demand for lifestyle blocks of 100 acres is high and the price of these blocks far exceeds their agricultural value. This is the reason Meadows is $5000 an acre. Penola on the other hand is down South, less rainfall and not as pretty and you won’t be living next-door to a surgeon. In Penola, in general, land prices will be more closely tied to their agricultural value – and that is why Penola is $800 an acre. Strictly in terms of cattle returns for outlay Penola is the better bet because you can buy more feed per $ in Penola compared to Meadows. But future capital gains are likely to be higher in Meadows and the lifestyle type place (near amenities – hospitals – good schools – shops etc) appeals to many people. So you are looking at two very different types of operation and which one is best for you only you would know. But using your 100 acre Meadows block as a hypothetical case off the top of my head some ball park maths might look like this. Pick up 30 young black Angus cows – preg tested in calf. $32,000. Get 28 calves on the ground. Wean at 7 months at 250kg. At the moment prices are good – $1.80 kg live weight for heifers – $2.20 for steers. So assuming a 50/50 boy girl split returns approximately $13,000. This is really a maximum best case scenario and most years running an operation a bit larger than this I would not have achieved this return. Subtract costs: fertilizer for 100 acres say $2,000, hay making 100 bales – another $2,000, general fencing and odds and sods say another $3000. So your left with $6000 profit or $200 a head which is on the high side because I haven’t factored everything in right and prices are high here at the moment. This is all just ball park remember! In respect to what breeds are best – black / red Angus are getting more dominant in the area – and receive good prices from feedlotters. Not many people finish cattle themselves – the feedlot business here is pretty specialised and you really need a lazy million or two to get off the ground, good knowledge of the industry and it is probably a risky way to get started on cattle. Just out of interest I can report the local topic of conversation around here lately is the new electronic tagging of cattle we all have to do for the national database - which has created some very polarised views - but thats another topic in itself! I’m sorry if this all disappoints. But I will say as a plug for this part of the world that on the weekend (Sunday anyway) the weather was glorious – the grass was jumping out of the ground – our cattle are all doing well – the calves are growing – our children are being raised in an idyllic setting – our neighbours and our little local community are great to be a part of – and I wouldn’t have traded places with anyone. What better return from cattle can you get than that! Very much enjoy the board – have improved a couple of aspects of our little operation as result of things I’ve gleaned here and hope to make the odd contribution when I can think of something sensible to say. Regards SouthOz. [/QUOTE]
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