How do y'all do it?

[Todd 02]

I'm having a tough time with figuring out how to balance the expenditures for assets properly. Everything just seems so expensive. I've started from scratch and find that having the patience for everything to work out is extremely difficult.

My Current Situation:

I'm financing ~155 acres (~115 ac fenced mesquite and ~40 ac fenced plowable). Cost per year is ~$8,500 with 8 more payments remaining. There is one well, which feeds one galvanized tank in the ~40 ac pasture and one earthen tank in the ~115 ac pasture.

I currently own 14 cows (Red Angus and Red Brangus mix), 1 Red Brangus Bull, and 14 calves.

I own a 16ft gooseneck stock trailer.


I've got a great job in town and can afford the land and operational expenses without much difficulty. However, there are some essential tools that would certainly come in handy to make my cow/calf operation better. I've got a pretty good idea of what else I need, but I'm not sure how to afford it or how to do without it until I can afford it. These would be things like:

working pens;
tractor;
implements;
barn;
squeeze chute;
additional fences;
etc.

How do you guys and girls do it?

 

[BSKDixie]

First off, not to sound like a farm credit officer, but there should've been some foresight into capital improvements in the way of working facilities and equipment before the cattle ad been acquired. That being said, I'd say your first step should be evaluating your need for each item you listed, and how important it is to your operation, and if its purchase will be a good investment. One of the largest problems facing cattlemen and farmers in this day and age is they treat agriculture like a hobby, and then complain that no profit can be made in an operation. Another tip I would suggest is looking even harder at prices, does a calf garner any more profit if you take it to the salebarn in a 1,000 dollar trailer than if you take one in 10,000 dollar trailer with more bells and whistles?
I would say evaluate the importance of each item and how immediately necessary each is? Working pens and squeeze chute? Probably more important than a tractor unless you are pretty good with a rope. Also that being said, don't feel the need to buy a piece of equipment just because another cattleman uses it also, a tractor especially only depreciates in value the second you buy it, and to be honest I've seen guys that run close to 1,000 head get by without a tractor and be in great shape, a tractor is only worth the investment if you can justify it paying for itself in a certain amount of time, if you're going to be using it to do work that a shovel and good truck could do, youre really just losing money. Evaluate the purchases relevance to your operation, and how absolutely necessary it is.


Id say your biggest step here is just sitting down and essentially writing a business plan, your goals and where you hope your operation grows to, then develop a budget, its easy to say you need all this equipment, but when it comes down to it how necessary is all of it, and how quickly is it necessary?

If you could provide a little more information about your goals and what your plans for your operation are it would be a little bit easier to help you out

 

[Caustic Burno]

I'm having a tough time with figuring out how to balance the expenditures for assets properly. Everything just seems so expensive. I've started from scratch and find that having the patience for everything to work out is extremely difficult.

My Current Situation:

I'm financing ~155 acres (~115 ac fenced mesquite and ~40 ac fenced plowable). Cost per year is ~$8,500 with 8 more payments remaining. There is one well, which feeds one galvanized tank in the ~40 ac pasture and one earthen tank in the ~115 ac pasture.

I currently own 14 cows (Red Angus and Red Brangus mix), 1 Red Brangus Bull, and 14 calves.

I own a 16ft gooseneck stock trailer.


I've got a great job in town and can afford the land and operational expenses without much difficulty. However, there are some essential tools that would certainly come in handy to make my cow/calf operation better. I've got a pretty good idea of what else I need, but I'm not sure how to afford it or how to do without it until I can afford it. These would be things like:

working pens;
tractor;
implements;
barn;
squeeze chute;
additional fences;
etc.

How do you guys and girls do it?

There is no way you are going to come close with 15 cows just the hard facts.
It is hard to be profitable with today's margins with everything paid for. Year before last I turned 52 dollars a head profit after operating cost. Last year was better back up in the 100 dollar range profit per cow, and I am tighter than a crabs ass and that's waterproof. If you make the national average of 100 dollars a head profit after upkeep your at 1500 bucks hard to make that work out with a pencil.

 

[JRGidaho`]

Todd, I'm sorry to say it, but at your scale of operation, you need to just admit it's a hobby and then decide how much you're willing to spend on your hobby.

Ranching for Profit ( http://www.ranchmanagement.com/) maintains a set of benchmarks for allowable expenditures for economically viable ranches. These are expressed on a cow-unit basis and it is pretty easy to see from these benchmarks that you can't afford to spend very much on anything.

Give you an idea of how I view some things. When I push the pencil (not really! when I crunch the keyboard....) I find it takes a minimum of 300 cows to even come close to justifying owning a large round baler. When we look at the big square balers, it is more like 800 cows. Yet we see lots of guys with 20-30 cows who own a full line of haying equipment.

It's just a hobby for them, but they don't admit it.

 

[c farmer]

Todd, I'm sorry to say it, but at your scale of operation, you need to just admit it's a hobby and then decide how much you're willing to spend on your hobby.

Ranching for Profit ( http://www.ranchmanagement.com/) maintains a set of benchmarks for allowable expenditures for economically viable ranches. These are expressed on a cow-unit basis and it is pretty easy to see from these benchmarks that you can't afford to spend very much on anything.

Give you an idea of how I view some things. When I push the pencil (not really! when I crunch the keyboard....) I find it takes a minimum of 300 cows to even come close to justifying owning a large round baler. When we look at the big square balers, it is more like 800 cows. Yet we see lots of guys with 20-30 cows who own a full line of haying equipment.

It's just a hobby for them, but they don't admit it.

I own all of the hay equipment and the corn equipment and its all paid for so I can try to make a profit with cattle. I hope that with proper maintance the equip. lasts a long time. I do not have to pay someone to make hay or plant corn and then harvest it. Paying someone to do all of the crops gets expensive too.

 

[kenny thomas]

I would love to learn how to manage 1000 cows without a tractor. I can't do it.

 

[Aaron]

Todd, I'm sorry to say it, but at your scale of operation, you need to just admit it's a hobby and then decide how much you're willing to spend on your hobby.

Ranching for Profit ( http://www.ranchmanagement.com/) maintains a set of benchmarks for allowable expenditures for economically viable ranches. These are expressed on a cow-unit basis and it is pretty easy to see from these benchmarks that you can't afford to spend very much on anything.

Give you an idea of how I view some things. When I push the pencil (not really! when I crunch the keyboard....) I find it takes a minimum of 300 cows to even come close to justifying owning a large round baler. When we look at the big square balers, it is more like 800 cows. Yet we see lots of guys with 20-30 cows who own a full line of haying equipment.

It's just a hobby for them, but they don't admit it.

That's true if you are buying new. But most producers are quite willing to buy 'lightly used'...which lends itself to smaller operations than 300 cows.

I agree, with 20-30 cows, you don't need haying equipment. :cowboy:

 

[Jogeephus]

With an investment in land of that acreage I think a tractor would be essential not only for the cattle but also for the maintenance of your property. Like many businesses you have to invest in infrastructure till you build a workable operation. I think there is a chinese proverb that says a long journey always begins with one step. You gotta decide if you want to go on the long journey and it sounds like you have made that decision as many of us have. That said, "how I do it" is this. Instead of looking at how much I'm "expecting" to make each year on the cattle I look at my net per head. Each time I think about buying a bag of range cubes, mineral, fertilizer etc I try to figure how many calves its going to take to make this purchase. I'm also like a rat and will jump at the chance to barter, scrounge or do whatever to keep my maintenance costs as low as possible. Good luck.

 

[Caustic Burno]

Around here you can make more with hay equipment than you can with cow's.
There is a shortage of custom balers and these horse people don't bat at eye at paying outrageous prices for hay. Saw 5x5's going for a 100 bucks.

 

[hillrancher]

Todd with a operation as you have you cannot justify any thing. Buy what you can afford and go for it.
I have been in the business for 32 years and have had a outside income until last year. I sold 1/2 of calf crop this Feb. 1st time that I can say I made a profit in the 32 years having cattle. Cattle is a business that $ are few and expenses are execessive.You cannot count on the same each year it is up and down.

 

[novatech]

I would love to learn how to manage 1000 cows without a tractor. I can't do it.

Buy your hay. Have your pasture sprayed once a year. Truck with hay lift on back.

 

[bigbull338]

you need to only buy things you really need.1st on your list should be a tractor an shredder.then id get my corral like i want it with a squeeze chute.right now im in the process of buying my 1st squeeze chute.then im going to buy a few more cows in the next 2 months.

 

[I luv herfrds]

Don't buy new. The newest tractor on our place is the lawn tractor that replaced a JD110.

Check out auctions, but take someone with you who knows about what you are looking at. Have a set price and if it goes over it walk away.

 

[BSKDixie]

I would love to learn how to manage 1000 cows without a tractor. I can't do it.

Feed with one hay truck and TMR mixer, scraped pens with blades on ATV's, saved a good bit of money without a tractor, the guy ran about 900 some brood cows and another 350 stockers, and never once had a tractor

And I'm afraid I still disagree with bigbull and Jogeephus (respectfully disagree of course), If he doesn't even have a squeeze chute or working facilties, and only 14 cows and 14 calves, its not like hes going to be feeding a few hundred round bales a winter? And price wise, even if you're buying a tractor used, In my opinion its still cheaper to buy an ATV with implements (scraper, trailer, etc.) or fit a bale roller on a truck than it is to buy even a compact tractor. Even if you're looking on a deeper financial level and looking at opportunity cost, if by buying a tractor would he save money by eliminating time he would be able to spend on something else? Maybe so, but unless hes really doing a lot of feeding, an ATV with implements is still way cheaper, easier to repair, less fuel etc. (in my experience)
I still say working facilities should be one of the first steps, unless his cattle are "tame as dog pets" how is he going to administer vaccinations? Treat whatever ailment they come down with? What if a cow calves and you have to pull the calf, some cows will be stay down but others don't always play nice. If he buys a tractor first yes maybe it makes some feeding easier, he can do some projects on the land, but how does he work his cattle? Shoot hes gonna run the money off his cows just chasing them around his pastures trying to give them a shot. Not to mention if he plans on doctoring in the field, hes gonna pay for it in the end with hospital bills alone unless he is a pretty good hand with a rope and a horse (not saying you aren't Todd) I'm not trying to ruffle any feathers, but I don't see how a tractor can come before something that in my opinion is necessary when working with cattle (doesn't have to be a Big Valley hydraulic chute with all matching colored panels and swing doors everywhere, just needs to be a set of corrals that you are able to work with), I think it would be good if Todd let everyone know a little bit more what he was shooting for (goals, hobby vs profit, etc)

Also, some cattlemen's associations have cost sharing programs available for smaller producers for working facilities, and some associations have deals with manufacturers of chutes and panels, something also to look into

 

[marksmu]

Fully possible to find a vet that has own mobile equipment. It all depends on where you are. For $50 + materials and a per head fee I can get the vet to my place to do the vacs...at that price they are supposed to be rounded up before he gets there. For $300 he will bring his mobile corral and squeeze. You still need to get the cattle into it, but he will use his own equipment.

He will bring just the squeeze for $100 if you have panels or something to work off of.

I think in terms of what to buy and when...like any business out there, there are start up costs. I see a tractor as a necessity. There are ways around having one, but for the operation we run, it would end up costing much more in the long run not to have one, than it would to just buy an old used one.

Personally, I subsidized our place with start up equipment that I wanted....and for the next 30 years I expect to gradually pay myself back.

Im realistic that Im not making money right now, but I see down the road too, where I will make the money, and my day job allows me to get there. Raising cattle and being on the ranch is a lifestyle that I want badly....I dont mind kicking extra cash into it, as I get more enjoyment from a day on the ranch working than I do on a Cruise ship or some type of vacation. Equipment is an invesment. Making it payback can take a long time, but its fully possible to do so.

To answer your question outright. I would build a set of pens, and get a squeeze first, then get a tractor....it all depends on how much enjoyment you get out of it all. If you dont enjoy it enough to not regret the expense, then I would rent the land to someone else who does.

 

[Hippie Rancher]

Would love a tractor, but there has not been one owned by this place in over 100 years. (150 - 200 head, 22 sections semi desert, rocky, "native" range) Rent, borrow, pay somebody else for the occasional heavy machinery.

30 - 50 head? Keep them gentle and work them in the trailer or snub them to a post.

a couple of decent pens for sorting, maybe - if they are good and gentle, panels will work - a runway for loading into the trailer. (also look up medina gate - I learned about that from somebody in this forum - good idea, except most of our animals are a little to wild for that)

fencing - how big are your mesquites? Get a saw and a shovel, set some posts. cut stays from smaller branches, all you need to buy is wire. (consider electric with the sizes of pastures/numbers of cattle you mention)

 

[KMacGinley]

The piece of equipment I use most is a 731 bobcat. That is what I would get.

As to how you do it... take your time, start slow and pay as you go. It is cheaper to rent land than to buy it.

 

[Brute 23]

The people I work for seperate out cattle and land. Not sure the exact numbers but real estate on average grows like 3%. It can be higher in some areas but over the long term its around 3%. That is an ivestment in itself aside from the cattle. Any time you own real estate you have upkeep such as perimeter fencing, water, ect. Improved grass, additional water, pins, manicured trees, ect all add value to the land so that can go against the land.

Then when it comes to cattle you have to decide if you want to operate them as cash income or an asset. Squeeze chutes, labor, cattle trailers, ect all go against the cattle.

Sit down with an accountant or financial advisor and start drawing your lines in the sand. When this is clear it makes it alot easier to decided how to "value" items such as pins, chutes, equipment, internal fencing, ect.

When we went into this down turn alot of people thought land would become dirt cheep. Its actually held it there pretty good because so many people pulled money from the stock market and put it into land, especially large tracks.

 

[shaz]

Get to know your neighbors and see if you can pool some resources.
Your situation is not that bad. Look at the price appreciation on the land.

FYI: I spend a WHOLE LOT MORE on land than 8K a year.

 

[bird dog]

My operation is run like Brutes. The profit is in the real estate. I would buy a good used name brand tractor that you can use to improve the land as wll as help with the cattle. Good pens and fences add a lot of value. People looking to buy land want good fences, a water source, working pens and good grass. You will get a lot of your money back when you sell, so but them now so you can enjoy them and flip the property for something larger when the time is right.