Figuring profit per cow

[Banjo]

The subject was raised an the pryor thread. How does everybody figure costs and profit per cow? Just the basic yearly inputs or do you go into the cost/value of the land, buildings, etc.?
The guy that can graze year round or almost with no hay or very little to purchase or put up will have lots less $ inputs than he who needs/uses a lot. Same way with fertilize.

 

[snake67]

We put everything in and everything out.

If you are in the business and you do not you are fooling yourself.

Mortgages, fuel, maintenance, repair - the whole shebang.

Then we total up all the incomes off the farm sales.

If you are in the business you HAVE to do that to get your true costs of production and your true profit/loss.

If you do not do this you are simply fooling yourself.

Part timers can figure it any way they want and usually never add their time - which is an important player that should be figured into the mix as it really does matter.

Others who play at it with one or two or a dozen animals can pretty much do what they want as for the most part they will come up with reasons why they either do or do not add certain things into the mix.

So there you go - do as you see fit - no one here can tell you how to do it and in the end only YOU will make the final decision.

Have a Merry Christmas and a great New Year.

Be safe

Bez

 

[Brute 23]

These discussions have been had over and over again. They pretty much go no where.

You will never convince people they aren't making money and most are ok with that.

 

[sim.-ang.king]

I just take the expenses of feeding, care, and cattle purchases plus, taxes/rent, issuance on truck and trailers, any interest payed, and fuel/parts for equipment, and subtract that from any income made, which includes sale of any thing connected to the cattle (like hay, or cattle equipment). Basically anything that has to do with cows get put in the records.
Then divide that number by the number of cows, breeding heifers, and bulls.
Like Bez said if you don't take everything into effect then your going to have screwy profit numbers. Some may make it look like they are making $200 a head, but they forgot to add in insurance, fuel, and that they bought 5 heifers back in the spring.

 

[highgrit]

Part-timer here, I take out what I spend on the cows. But before I had cows I still had a truck, the land and I carried Insurance on both. The cows can't eat on the green fields till after hunting season, and they don't eat corn out of the deer feeders, but they do pay for both and the fertilizer to boot. I charge the cows for fencing the property off even though I fenced most of it off before we had any cows. We will never make any money on cows, well maybe a little every few years. If your self-employed and make money, you better make a bundle of it cause the IRS will have to get theirs. To give away to the deadbeats and welfare moms, so on and so forth.

 

[Banjo]

I remember back when I used to grow tobacco, the U of KY would do a seminar every year on growing tobacco and they would have a chart that showed what it cost to produce and acre of tobacco. By the time they figured depreciation of barns, tractors, equipment, figured the value of the land etc., there wasn't much left.
I guess what I'm saying is that some things are just fixed. Like the old barn standing there deteriorating, I'm going to carry insurance on the farm anyway, I'm gonna have a truck anyway, and/or a tractor anyway. I could lease all my land and still have the expenses I just mentioned. So I figure my realtime inputs for the year into the cows and the land which support the cows which would include or not, depending on what I use or not use of Hay, Fertilize, Seed, Fuel for mowing, bushhogging, deathloss if any, salt/mineral, repairs and maintenance. Basically the way I do a tax return. In the end you need more coming in than going out obviously.

 

[plumber_greg]

Remember agmantoo? He would always tell everyone how easy it was to lower your cost of production, yet he himself couldn't duplicate it. I remember he would work 30 minutes a day for 40k on 100 head, but couldn't work an hour a day for double that, too many variables, so he couldn't quit his day job. His cost of production was probably accurate, just hard to follow for anyone else. I have heard for too many years how someone has if figured out. Just do what you think works for you. gs

 

[Banjo]

Remember agmantoo? He would always tell everyone how easy it was to lower your cost of production, yet he himself couldn't duplicate it. I remember he would work 30 minutes a day for 40k on 100 head, but couldn't work an hour a day for double that, too many variables, so he couldn't quit his day job. His cost of production was probably accurate, just hard to follow for anyone else. I have heard for too many years how someone has if figured out. Just do what you think works for you. gs

Yes I remember him....still see his posts on Homesteading Today. I think in his situation he is at max production with the number of acres he has. I've incorporated a lot of his ideas in my own operation. It does work.

 

[xbred]

i answer all the questions my account ask me. and she tells me how much the farm made..

 

[tnwalkingred]

This question is a very old debate and it seems like no one ever figures it the same way and the majority say they don't make any money on cattle. If this was true however why are so many of us in the cattle business? I would like to know how many on this site make a living solely on cattle? No hay sales, no grain sales, and no other non farm income? I'm willing to bet this number is VERY low. The majority of us make our living on something other than cattle. This is not to say we don't make money on them but it does make it much harder to standardize input costs. We all have various opinions on what should and should not be included in costs. For many of us it's a hobby and that in turn makes it easy to justify not including certain costs. On the flip side of things I also know that most farmers consider their cattle crop as their cash crop. It seems they are the one steady source of income compared to hay and grain sales. I have a good friend who has made a living on nothing but hay and cattle his entire life but will tell you he's never made a dime. He brand new john Deere cab tractors and pickup trucks tell a different story however. I would say most of us assume it's pretty cut and dry what we make at a 9-5 job per year but those same people never include their drive time to work, costs of a baby sitter, or wear and tear on their vehicle. They also don't include the cost of education that they use in their day to day jobs. I bet if a man making 100k a year working in the corporate world figured everything some on here say we should figure in the cattle business that he would be right on board with the rest of us saying we never make any money! Lol

At the days end we should all do what we love and if that love is cattle then go for it. I have found that it's one of the most rewarding hobbies I've ever had and it's a whole lot cheaper than playing golf 7 days a week!

Kyle

 

[Bigfoot]

I for one do it, because it's a great place to raise a family.

 

[inyati13]

This question is a very old debate and it seems like no one ever figures it the same way and the majority say they don't make any money on cattle. If this was true however why are so many of us in the cattle business? I would like to know how many on this site make a living solely on cattle? No hay sales, no grain sales, and no other non farm income? I'm willing to bet this number is VERY low. The majority of us make our living on something other than cattle. This is not to say we don't make money on them but it does make it much harder to standardize input costs. We all have various opinions on what should and should not be included in costs. For many of us it's a hobby and that in turn makes it easy to justify not including certain costs. On the flip side of things I also know that most farmers consider their cattle crop as their cash crop. It seems they are the one steady source of income compared to hay and grain sales. I have a good friend who has made a living on nothing but hay and cattle his entire life but will tell you he's never made a dime. He brand new john Deere cab tractors and pickup trucks tell a different story however. I would say most of us assume it's pretty cut and dry what we make at a 9-5 job per year but those same people never include their drive time to work, costs of a baby sitter, or wear and tear on their vehicle. They also don't include the cost of education that they use in their day to day jobs. I bet if a man making 100k a year working in the corporate world figured everything some on here say we should figure in the cattle business that he would be right on board with the rest of us saying we never make any money! Lol

At the days end we should all do what we love and if that love is cattle then go for it. I have found that it's one of the most rewarding hobbies I've ever had and it's a whole lot cheaper than playing golf 7 days a week!

Kyle

Kyle,
I enjoy my dog, farm and cattle. It pay for that enjoyment. I can project and see that there is an opportunity for profit albeit a small one. But unless you have a large scale operation and reputation that allows you to market like say the Boyds do here in my area, I don't see how anyone makes any significant profit with cattle. I hear the same thing you mention. Most of the cattleman here say they do not make a dime. Some have told me stories of having very devastating losses. For example, a producer here who runs about 50 cows told me a few years ago cattle markets went down and in the spring he bought abou 100 head to put on lease land with the intention of putting weight on them and selling them. He said he lost about 20 K because the market went down even more and he had to sell to cut his loses.

I think it is more about lifestyle than profits. But what I have noticed is that most business here in my part of Kentucky has the same problems. The cost to produce a product whether it is cattle, furniture, metal works, etc. exceeds the selling value of the product. Something has to change. US business except for some exceptions is tough.

 

[TexasBred]

It was much easier and accurate when everyone put all their money in a cigar box and paid expenses out of the box. On January 1st you counted what was Left IF there was any left

 

[Bigfoot]

I would suggest a "farm account" for anyone raising cattle on the side. It makes it look more legit if you get audited, makes record keeping easier, and you will be less inclined to spend your "personal" income on the farm. You will see pretty quickly where the money is going.

 

[Banjo]

The bank I deal with here has a online record keeping program called FinanceWorks. When you get online to check your checking acct balance or whatever, you can click on that button and it lets you categorize everything that goes thru that acct....either business or personal. It will track everything for you and at the end of the year you can just print it out and do your taxes. A big time saver for me. I would say most banks have something like that now.

 

[snake67]

This question is a very old debate and it seems like no one ever figures it the same way and the majority say they don't make any money on cattle. If this was true however why are so many of us in the cattle business? I would like to know how many on this site make a living solely on cattle? No hay sales, no grain sales, and no other non farm income? I'm willing to bet this number is VERY low. The majority of us make our living on something other than cattle. ............

I know this has been beat to death TWR - but please do not tell anyone I told you this.

Most likely 95% of people (or more) on this board actually loose money on their animals.

No matter what they say in public.

But it does ot matter - they can justify it with all sorts of excuses. LOL

Cheers

Bez

 

[slick4591]

I have an old version of QuickBooks left over from my retail days where I keep all the farm expenses entered. I have a different program for cattle management and can tell you to the penny where each animal stands financially. What the cattle management doesn't do is tell you how much money you have in fencing or other non-animal items associated with the farm. It's really nice having all that information at your fingertips. The QuickBooks also makes it really easy at tax time because I can print the entire year of entries for the accountant.

 

[Bigfoot]

The bank I deal with here has a online record keeping program called FinanceWorks. When you get online to check your checking acct balance or whatever, you can click on that button and it lets you categorize everything that goes thru that acct....either business or personal. It will track everything for you and at the end of the year you can just print it out and do your taxes. A big time saver for me. I would say most banks have something like that now.

Good post. I didn't know that.

 

[highgrit]

Bez, your painting with a very large brush. Boy there's a bunch of losers on this board. I have seen a bunch of fat cow pictures posted on this board though. I can't see how you can lose money on a cow in the south. Hay is cheap, and grass grows most of the year.

 

[TexasBred]

I know this has been beat to death TWR - but please do not tell anyone I told you this.

Most likely 95% of people (or more) on this board actually loose money on their animals.

No matter what they say in public.

But it does ot matter - they can justify it with all sorts of excuses. LOL

Cheers

Bez

Best and most simple way for me to justify it is to simply say "it's my dam money". :mrgreen: