How big is big enough?

[Caustic Burno]

A little taste of reality now...

Ya got land. Ya got infastructure and ya got the knowhow. Ya even have 150 cows. What about the bank roll? Is it a piggybank or a suitcase? Even if you could clear $100 a head on 150 cows a year you are still living in poverty? You might have a million in assets but you are cash poor.

Never a truer statement like 08 I made 52 bucks a head, sure would be tough supporting a family on that income alone. This year is much better but you would still be at poverty level as Vett stated. The lifestlye would be fantastic if you had an additional source of income with benifits, without it you won't have a lifestyle.

 

[novatech]

Hello

I am trying to figure out just how many acres it will require to support my family. The land has a carrying capicity of 10 acres to a cow. That is a conservative stocking rate. I am planning on runing a cow/calf opertation. Thanks for the help. :tiphat:

I hate to be this blunt, but there are not enough acres available for you to make a profit let alone support a family. I come to this conclusion simply by the question you asked.
Your knowledge and skills are the determining factors. Your question leads me to believe you do not have them.
You may however be able to hire someone who does. Over time you can learn and develop the skills necessary to one day, maybe, run it yourself.

 

[xbred]

i know people who own no land and make a living with cattle. it's like any other business you gain knowledge and contacts and a gut feeling and a certain hardness until it becomes second nature. everybody wants to get enough mama cows to sell a calf crop once or twice a year and pocket enough money to live on. that's nice if you can, but those i see making a living on cattle are working everyday and doing little things here and there buying, selling, leasing, moving cattle, and before you know it many years have passed and they have made their living with cattle, and for the most part they can't tell you how they did it..

 

[Brandonm22]

You grew up on THIS ranch and you need us (I have never even BEEN to the Nebraska Sandhills) to tell you have much you can clear per cow on it?? and how much income you need for you and your family?? I need more information to actually be able to make a recommendation for you; but clearly you don't have enough knowledge at this time to do this. How much did you and yours actually spend in 2009? Include taxes, including the FICA your employers paid and insurance (life, health, home, and auto). Don't ASSUME that you are going to suddenly make a bunch of cuts of things you have never cut before. IF you lived off of $30,000, divide that by $100 profit per cow, then you need 300 cows. Multiply that by 10 acres per cow and we come up with 3000 acres. That is probably the BEST CASE scenario. Change that number to Caustic's pathetic but believable $52 number and I come up with 577 cows and 5770 acres. Change your lifestyle to $50,000 and I come up with 962 cows and 9620 acres. Then you have to borrow the money for the cows. The bred cows I want people got priced at $1200++ each. Lets say you shop around and find somebody willing to part with a put together herd for $750 each. 300 cows would be $225,000 at that price. For a five year note expect to pay ~$340,000 for that money or $68,000?? a year. The cows have to clear $327 to pay for your minimalist $30 g lifestyle and pay the note on them. I won't even calculate numbers on 962 cows because no bank will give you that much money without putting up land.

 

[DangYankee]

Well, you sure walked into it. But, you had to see it coming. I would recommend you check out http://www.cffm.umn.edu/index.aspx the Center for Farm Financial Management at the University of Minnesota. They have some wonderful programs online for free that can really help you develop your sense of how to make money in agriculture.

Of course I always remember the lady who raised race horses who said,"There's only one way to make a small fortune in horses, start with a large fortune".

 

[Workinonit Farm]

Well, you sure walked into it. But, you had to see it coming.

From where I sit, based on my limited experience, as well as the farmers/ranchers I know, much of the info/advice given to this person is very realistic.

Katherine

 

[thatdoggJake]

How big is big enough? ....

Probably just a little bit more.

 

[sandhills]

I got it all calculated out. Thanks all. I was just maybe trying to save myself the pencil work time and though some of you guys would know off the top of your head what it would be. You know sometimes just because you live on the ranch doesn't mean that the financials are laid out there for you all the time. My dad kept it his bussiness. He never shared what he made per head for profit with me. It is always easy to be a critic I guess.

 

[1982vett]

I got it all calculated out. Thanks all. I was just maybe trying to save myself the pencil work time and though some of you guys would know off the top of your head what it would be. You know sometimes just because you live on the ranch doesn't mean that the financials are laid out there for you all the time. My dad kept it his bussiness. He never shared what he made per head for profit with me. It is always easy to be a critic I guess.

Truthfully, only you can figure what it will take for you to be happy. You will be happier along the way if your wife is happy too. Asking someone else what they think about it doesn't mean a thing in the end as the variables are as many as their are people and farms.

Now if you want us to really have fun...tell us what you have calculated out.

 

[Brandonm22]

I got it all calculated out. Thanks all. I was just maybe trying to save myself the pencil work time and though some of you guys would know off the top of your head what it would be. You know sometimes just because you live on the ranch doesn't mean that the financials are laid out there for you all the time. My dad kept it his bussiness. He never shared what he made per head for profit with me. It is always easy to be a critic I guess.

This is the cow business. There are some people making $200 a cow (not many) and some people losing $400 a cow (not for long) and most are somewhere in between and like your Dad most don't share how much they clear. I would bet most are somewhere between $0 and $70 a head this past year. There are people who are very knowledgable about cows who are losing money right now. A lot of it depends on how much you have to supplement in the winter, your live weaning percentage and what your calves bring in total dollars per head......and honestly prices are down. Pg 44 ofthe Jan Alabama Cattleman has Med and Lrg 1 steers bringing $499.83 for 581 lbs. Put 90 lbs on them and all you get is another $54.55. 2s are bringing almost the same. Feeder heifers are just as bad. 570 lb 1s are avging $448.82. 668 lbs 1s are avging $506.34. 577 lb 2s are avging $428.71 677 lb 2s are avging $481.14. Yall get better prices in Nebraska but it is hard to be bullish when 200 high six weight calves are likely not grossing more than $103,552. For comparison's sake, not many years ago that same load would gross $163,346 (using 1.30 lb for the steers and 1.15 forthe heifers). IF he has records, dig them up. If he used an accountant, the estate can ask for copies of his tax returns. A lot of people's taxes aren't accurate; but any records are better than nothing.

 

[Ryder]

I got it all calculated out. Thanks all. I was just maybe trying to save myself the pencil work time and though some of you guys would know off the top of your head what it would be. You know sometimes just because you live on the ranch doesn't mean that the financials are laid out there for you all the time. My dad kept it his bussiness. He never shared what he made per head for profit with me. It is always easy to be a critic I guess.

And the answer is.............?

 

[Workinonit Farm]

It is always easy to be a critic I guess.

I really believe that the majority of us who responded to your post were not trying to be critical. I think Brandonm22 summed it fairly well.

Katherine

 

[sandhills]

I dont think I will be sharing the plan. I have learned my lesson. Nothing good would come of it.

 

[GMN]

Keep your dreams, without them you got nothing, and don't be discouraged by what others think, there are many ways to run a business, and everyone does it differently. its not always how much land you need but what you do with what you got to work with.

GMN

 

[Ryder]

Keep your dreams, without them you got nothing, and don't be discouraged by what others think, there are many ways to run a business, and everyone does it differently. its not always how much land you need but what you do with what you got to work with.

GMN

He asked for help and several people that have been there, done that, offered sound advice, not personal criticism. It seems that is not what he really wanted. He has it all figured out now.
He does not need a dream. He has a "plan". A "secret plan."

 

[chippie]

I have a suggestion.

When you figure your budget, calculate your expenses on the high side, not the current cost. That way should you come in below budget, you will have a bit to set aside for an emergency fund.

It's always a nasty feeling when the cost of running an operation ends up costing more than expected.
The same goes for cost of living.

Good luck.

 

[sandhills]

Thanks Chippie. That is what I did. Figured better to be safe than sorry.


Ryder you haven't contributed anything positive to this thread yet. You seem like a person that just wants to stir the pot. Anyway Thanks guys and gals. Moving on.

 

[3waycross]

Thanks Chippie. That is what I did. Figured better to be safe than sorry.


Ryder you haven't contributed anything positive to this thread yet. You seem like a person that just wants to stir the pot. Anyway Thanks guys and gals. Moving on.

I thought Ryder added something very valuable. He called a spade a spade. :nod: Go ahead and move on. :wave:

 

[rockridgecattle]

I got it all calculated out. Thanks all. I was just maybe trying to save myself the pencil work time and though some of you guys would know off the top of your head what it would be.

Okay, as much as I admire you taking over the family farm, you need to do all the pencil work for yourself. First off, it gives you the understanding of where your money goes, and second, it gives you the ability to figure where your money should and should not go. In everything you do, always use the pencil and paper and figure for yourself. You need to be responsible of the farm financial decisions and the only way to do that is to do it yourself. NO shortcuts in this business.
Ok, now that has been said....
Since this is a family farm and you are taking over, do you have this in writing from your parents, are there other sibblings who will want their share of the farm when your parents have passed? Is the succession plan been put into practice so everyone in the family is ok with what is going on?
Family farming can be a serious challenge...just ask half the folks on here including me. What about your spouse? How does he/she feel about all this?
IF none of this has been thought of, google John Fast, or Elaine Froese. These are people who work with families and the conflicts of the family farm and the lack of succesion planning. Ag canada has webinars where these people and others like them speak, and you can watch them for free on the webinar site.

 

[Brandonm22]

Since this is a family farm and you are taking over, do you have this in writing from your parents, are there other sibblings who will want their share of the farm when your parents have passed? Is the succession plan been put into practice so everyone in the family is ok with what is going on?
Family farming can be a serious challenge...just ask half the folks on here including me.

I have been assuming that his father was dead, since he was asking us what a cow on that ranch would clear and admitted that he never knew what his dad cleared per cow. IF Dad is alive and still competent mentally, he needs to run his secret plan by Dad.