How Many cattle to run a cattle ranch

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KentuckyRookie":360sm2ee said:
Then there has to be other avenues in order to make real money in this. That kind of return is crap. No wonder I hear that 5% of cattle farms make 85% of all the money and the other 95% of farms make the 15% left. I think I need to follow the advice of that 5% don't you.

A university recently calculated that it took 954 beef cows to make a $55,000
income. I think Dun found that article for us.
 
KentuckyRookie":1sx192ve said:
Then there has to be other avenues in order to make real money in this. That kind of return is crap. No wonder I hear that 5% of cattle farms make 85% of all the money and the other 95% of farms make the 15% left. I think I need to follow the advice of that 5% don't you.

If you figure out how to make real money in the cattle business on a small commercial scale, I sure wish you would shoot me a PM. :) I dare say that the 5% that make 85% of the money are much larger than most of the individuals who chat on here and that they have vertically integrated their operation and retain ownership of their cattle through more than one phase of the business. Or they are seedstock producers that have spent years building their brand and are able to seperate themselves from the masses because of it.
 
KentuckyRookie":6ibs79vo said:
Then there has to be other avenues in order to make real money in this. That kind of return is crap. No wonder I hear that 5% of cattle farms make 85% of all the money and the other 95% of farms make the 15% left. I think I need to follow the advice of that 5% don't you.

Where did you hear this? I find it a bit hard to believe.
 
KenB":4krjqqqw said:
KentuckyRookie":4krjqqqw said:
Then there has to be other avenues in order to make real money in this. That kind of return is crap. No wonder I hear that 5% of cattle farms make 85% of all the money and the other 95% of farms make the 15% left. I think I need to follow the advice of that 5% don't you.

Where did you hear this? I find it a bit hard to believe.

Maybe overheard it in the crapper at the local salebarn
 
dun":1henb77s said:
KenB":1henb77s said:
KentuckyRookie":1henb77s said:
Then there has to be other avenues in order to make real money in this. That kind of return is crap. No wonder I hear that 5% of cattle farms make 85% of all the money and the other 95% of farms make the 15% left. I think I need to follow the advice of that 5% don't you.

Where did you hear this? I find it a bit hard to believe.

Maybe overheard it in the crapper at the local salebarn
:lol: :lol: :lol:
 
skyline":dep2dmjw said:
KentuckyRookie":dep2dmjw said:
Then there has to be other avenues in order to make real money in this. That kind of return is crap. No wonder I hear that 5% of cattle farms make 85% of all the money and the other 95% of farms make the 15% left. I think I need to follow the advice of that 5% don't you.

If you figure out how to make real money in the cattle business on a small commercial scale, I sure wish you would shoot me a PM. :) I dare say that the 5% that make 85% of the money are much larger than most of the individuals who chat on here and that they have vertically integrated their operation and retain ownership of their cattle through more than one phase of the business. Or they are seedstock producers that have spent years building their brand and are able to seperate themselves from the masses because of it.

When that great wealth building pm comes to you, please cc me a copy of it too. I want to get rich in the cattle business too... :dunce:
 
That business is like any other in this society. It is a meritocracy. Either the market likes you and your cattle or it does not (most people are somewhere in the middle). You can sell seedstock for 30 years and NEVER be accepted by either the commercial buyers or your fellow purebreeders. Then again you could have guys coming out and offering you $30,000 for donors and $20,000 for half interest in your best bull calf in five years too. It is like everything else in life, you won't really know whether you are good at it until you do it......and then it is too late.
 
Today's farms/ranches have to be bigger. A recent report by the Univ. of Minnesota ag business school (Gary Hachfeld)did a study on just this question. The study was done in 2007 and covered 850 family farms. Their findings were that the average household and personal expenses for a farm family equated to $74,804. This includes food,clothing, shelter, retirement, personal taxes, tithing, health care, insurance, etc. So, the average farm family of four (actually 3.4 was average) has to net close to $75K to make a modest living as a self employed entity. At first I thought that can't be correct. A family of four, surviving on ranch income, that's me, and we don't need that much. Then I started talking to our book keeper (my wife) and that is actually close to what we need and close to what we bring in from the cows and other misc. income. Now, the kicker for a ranch-only outfit is that this study says to net this amount the average outfit needs 948 cows. That seems crazy at first but looking at the national stats on the national average profit per cow across the board (it often hovers between $50 and $75) and it is in the ball park. This had me thinking no way at first but looking at averages it is right in there. We don't run that many cows (hundreds but not 950), but we also are affiliated with a farm and utilize crop residue ( beet top silage, alfalfa stubble, canola residue, etc) so our feed expenses are not average. I'm sure this study assumed the average place was buying hay for all of their cow's winter needs. A couple years ago, before hay went through the roof, ( hay was around $85/ton) and I figured on feeding for 3.5 months; I figured we could make a viable family business with 300 cows. Back in 1991, when I graduated, I was part of a study with the Univ. of Montana. The U just inheirited a ranch and we were composing a managment plan. Our calculations back then suggested that at least 150 calves had to be produced each year to pay the bills ( as a state owned entity taxes were not part of the equation). So, 150 calves means you need about 180 producing cows to account for your replacement heifers and calf losses. The average herd in Oregon is 40 head. Most ranches in Oregon and in the USA for that matter have one or more of the participants receiving income from outside sources. The typical scenario is the wife works in town and subsidizes the ranch income so the husband can work his hiney off and feel like he is contributing. Statistics say that he is in 1 year out of 7. Have you heard about the rancher who won 10 million in the lottery? When asked what he was going to do with the money he replied, " I'm going to keep ranching until it is all gone."
 
RanchManager":1yc11bac said:
Today's farms/ranches have to be bigger. A recent report by the Univ. of Minnesota ag business school (Gary Hachfeld)did a study on just this question. The study was done in 2007 and covered 850 family farms. Their findings were that the average household and personal expenses for a farm family equated to $74,804. This includes food,clothing, shelter, retirement, personal taxes, tithing, health care, insurance, etc. So, the average farm family of four (actually 3.4 was average) has to net close to $75K to make a modest living as a self employed entity. At first I thought that can't be correct. A family of four, surviving on ranch income, that's me, and we don't need that much. Then I started talking to our book keeper (my wife) and that is actually close to what we need and close to what we bring in from the cows and other misc. income. Now, the kicker for a ranch-only outfit is that this study says to net this amount the average outfit needs 948 cows. That seems crazy at first but looking at the national stats on the national average profit per cow across the board (it often hovers between $50 and $75) and it is in the ball park. This had me thinking no way at first but looking at averages it is right in there. We don't run that many cows (hundreds but not 950), but we also are affiliated with a farm and utilize crop residue ( beet top silage, alfalfa stubble, canola residue, etc) so our feed expenses are not average. I'm sure this study assumed the average place was buying hay for all of their cow's winter needs. A couple years ago, before hay went through the roof, ( hay was around $85/ton) and I figured on feeding for 3.5 months; I figured we could make a viable family business with 300 cows. Back in 1991, when I graduated, I was part of a study with the Univ. of Montana. The U just inheirited a ranch and we were composing a managment plan. Our calculations back then suggested that at least 150 calves had to be produced each year to pay the bills ( as a state owned entity taxes were not part of the equation). So, 150 calves means you need about 180 producing cows to account for your replacement heifers and calf losses. The average herd in Oregon is 40 head. Most ranches in Oregon and in the USA for that matter have one or more of the participants receiving income from outside sources. The typical scenario is the wife works in town and subsidizes the ranch income so the husband can work his hiney off and feel like he is contributing. Statistics say that he is in 1 year out of 7. Have you heard about the rancher who won 10 million in the lottery? When asked what he was going to do with the money he replied, " I'm going to keep ranching until it is all gone."

An interesting answer - and after reading it a couple of times I agree. Lots of folks say they can get by with less money - and that is true as well. However to actually keep the farm or ranch, pay for everything - including the mortgage, put the kids through school, pay the taxes AND eat - well I am surprized it is this low.

Figure you can do it all on that 70K? Good luck.

Lots of folks will pick your response to bits. But they have never sat down to figure how to make land pay for itself - today.

But then again you would be amazed at how many people do not know what it costs to keep one cow - or their own animals for that matter.

Or how many folks there are out there that actually believe you can make a living with 10 cows.

And I would be willing to bet that most folks here - on average - do not even own 10 cows.

In fact - if this money is all you are generating - then the banks will not deal with you for most major purchases - you will not likely qualify. You may have assets but they want cash, not land, in their vaults.

When things were decent we ran a pretty big operation and it was tight then - and we certainly could not buy land and equipment on our profit - I am relatively certain it is a bit tougher now. Most successful outfits came from long time ownership, inheritence or outside cash.

Ranchers - the smart ones - marry teachers and nurses.

Cheers

Bez+
 

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