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Cattle Boards
Grasses, Pastures & Hay
Hay prices not going down?
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<blockquote data-quote="Beef11" data-source="post: 333241" data-attributes="member: 2705"><p>It has very little to do with cost of production it has everything to do with value. </p><p></p><p>Let me put it in a scenario</p><p></p><p>you have 100 cows that have cost of about 250 a year not including hay. You buy hay at 120 a ton and buy 2 tons per cow taking your costs up to 490 per cow. OR 49k for 100 cows</p><p></p><p>Neighbor has same situation but grows his own hay and can do it for 30 a ton he figures it would only cost him 310 a year per cow. Or 31K for 100 cows</p><p></p><p>Seems all well and good unless you have anybody who knows anything about business look at your books.</p><p></p><p>Hay production is a seperate venture and has a seperate profit center. It is accountable for making a profit. Farmer B didn't figure that he could rent his hay for 120 a ton and made 24k off of the hay he fed to his cows it cost him that when he fed it the beasts. He could have rented his pasture out at 20 a month for 8 months and had another 16k he would have saved all of the medical expenses, labor, fuel, interest on capital and depreciation on machinery. </p><p></p><p>If you grow hay, do it to make money and be able to tell if you do. Hire a good accountant and take some business classes and keep a realistic view on expenses.</p><p></p><p></p><p>Good Luck</p></blockquote><p></p>
[QUOTE="Beef11, post: 333241, member: 2705"] It has very little to do with cost of production it has everything to do with value. Let me put it in a scenario you have 100 cows that have cost of about 250 a year not including hay. You buy hay at 120 a ton and buy 2 tons per cow taking your costs up to 490 per cow. OR 49k for 100 cows Neighbor has same situation but grows his own hay and can do it for 30 a ton he figures it would only cost him 310 a year per cow. Or 31K for 100 cows Seems all well and good unless you have anybody who knows anything about business look at your books. Hay production is a seperate venture and has a seperate profit center. It is accountable for making a profit. Farmer B didn't figure that he could rent his hay for 120 a ton and made 24k off of the hay he fed to his cows it cost him that when he fed it the beasts. He could have rented his pasture out at 20 a month for 8 months and had another 16k he would have saved all of the medical expenses, labor, fuel, interest on capital and depreciation on machinery. If you grow hay, do it to make money and be able to tell if you do. Hire a good accountant and take some business classes and keep a realistic view on expenses. Good Luck [/QUOTE]
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Hay prices not going down?
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