How much can you pay

[WichitaLineMan]

The thread where the ranches are for sale got me to thinking.

What is the right price to pay for land for raising cattle. Obviously lower is better but can land be bought anywhere in the US and be feasible to raise cattle.

I am talking price per animal unit?

For example Takes 10 acres to run a cow year round and land costs $800 per acre would be $8000 per animal unit.

What do you guys think the max feasible cost per animal unit is?

 

[EAT BEEF]

I don't really know,but most ranch seem to be priced at $10,000 a cow.Oldtimers use to tell me you couldn't pay over $2,500 a cow,but calves weren't as high. You can buy a lot of tillable ground and get a return of 4.5%-5.5% for land rent right now,that seems like a safe investment with the way the rest of things are going.

If you had to get the money from the bank I don't see how you could go over 2500-3000 a unit now,if your already going you can add land pretty easy and get it payed for.

What do you think your a numbers guy?

 

[bigbull338]

land prices have gone out of sight as far as raising cattle.if you could get good pasture bought for $4500 a unit youd be doing good.an im basing that on $1500 an acre.

 

[EAT BEEF]

bump You guys have got 2 at least have an opinion.

 

[Angus Cowman]

around here my banker who is a cowman and was long before he became a banker says in this area you can't pay more than a 1000 an acre and ever expect cows to pay for it
so if you can pay for the land and let the cattle take care of the maintenance and fertility costs and use the land as an investment then you are going to be able to sustain your operation but if you are looking for the cows to pay for it it had better be less than $1000 an acre and you better have a job in town or your wife better work for the gov't

 

[1982vett]

around here my banker who is a cowman and was long before he became a banker says in this area you can't pay more than a 1000 an acre and ever expect cows to pay for it
so if you can pay for the land and let the cattle take care of the maintenance and fertility costs and use the land as an investment then you are going to be able to sustain your operation but if you are looking for the cows to pay for it it had better be less than $1000 an acre and you better have a job in town or your wife better work for the gov't

Hard enough getting a $1000 cow to pay for herself and her keep much less expecting her to pay for land too.

 

[Angus Cowman]

around here my banker who is a cowman and was long before he became a banker says in this area you can't pay more than a 1000 an acre and ever expect cows to pay for it
so if you can pay for the land and let the cattle take care of the maintenance and fertility costs and use the land as an investment then you are going to be able to sustain your operation but if you are looking for the cows to pay for it it had better be less than $1000 an acre and you better have a job in town or your wife better work for the gov't

Hard enough getting a $1000 cow to pay for herself and her keep much less expecting her to pay for land too.

yep pretty hard to do

 

[piedmontese]

what i dont understand is how the cattlemen make it n states where u have 2 have so many acres per animal because of the poor grass.i saw an add 4 land where they had 2,500 acres and they said it would support 50 head.how in the heck u ever gonna make that work? in kansas u could run 50 head on 100 acres of grass.

 

[Angus Cowman]

what i dont understand is how the cattlemen make it n states where u have 2 have so many acres per animal because of the poor grass.i saw an add 4 land where they had 2,500 acres and they said it would support 50 head.how in the heck u ever gonna make that work? in kansas u could run 50 head on 100 acres of grass.

you must be in eastern kansas

 

[piedmontese]

what i dont understand is how the cattlemen make it n states where u have 2 have so many acres per animal because of the poor grass.i saw an add 4 land where they had 2,500 acres and they said it would support 50 head.how in the heck u ever gonna make that work? in kansas u could run 50 head on 100 acres of grass.

you must be in eastern kansas

Eldorado.flint hills which i think has some of the best grazing n the world.

 

[Angus Cowman]

Eldorado.flint hills which i think has some of the best grazing n the world.

yes it does

 

[kenny thomas]

I'll take some of your $1,000 per acre land AC. Junk land here is more than that. I really don't the cows will pay for the land here at $1,000. Most is bought for an investment. $4,000 per animal unit will not work.

 

[EAT BEEF]

what i dont understand is how the cattlemen make it n states where u have 2 have so many acres per animal because of the poor grass.i saw an add 4 land where they had 2,500 acres and they said it would support 50 head.how in the heck u ever gonna make that work? in kansas u could run 50 head on 100 acres of grass.

Whats funny is I could run a cow cheaper in Ohio than I can in Oklahoma and land costs three times as much in Ohio.I know a guy in New Mexico that runs about 160 cows on 12,000+ acres.He seems to love it,but think how much it would cost just to rebuild the fence.

 

[Herefords.US]

My leased place is currently on the market for $3250 an acre - and it takes 25-30 acres to run a pair year around. Do the math on that!

George

 

[EAT BEEF]

My leased place is currently on the market for $3250 an acre - and it takes 25-30 acres to run a pair year around. Do the math on that!

George

Thats only 81,250-97,500 a cow.Was going to ask if you had to feed any cake or hay,but I guess that not a factor if someone can pay that.

 

[1982vett]

When my Grandpa bought the first 190 acres of this place in 1901 it was 20% down and 4 payments over 4 years (about $10-11 and acre @ 8%). Back then their wasn't a second job to support the farm. The farm provided a living and paid for itself. Today, you can only look at land as an investment and agriculture is the means to circumvent paying exorbitant property taxes. If you are lucky you might have a natural resource that can be exploited.

 

[TexasBred]

When my Grandpa bought the first 190 acres of this place in 1901 it was 20% down and 4 payments over 4 years (about $10-11 and acre @ 8%). Back then their wasn't a second job to support the farm. The farm provided a living and paid for itself. Today, you can only look at land as an investment and agriculture is the means to circumvent paying exorbitant property taxes. If you are lucky you might have a natural resource that can be exploited.

Exactly....and add a few improvements over the years to help increase the value. Those large ranches that have been in the family for ages probably cost anywhere from "nothing" to a dollar an acre. Course a cow was probably worth about a dollar back then too. If you own land messin with cattle can just be one way to utilize it, hoping to make a little money or break even over time and make your profit. Whether you did well over the years is determined when it sells. Anything that hold the world together around here is $5,000 and most has cattle on it. No way cattle will ever pay for it.

 

[WichitaLineMan]

So people just indefinitely overpay for an asset relative to its earning power, because there is a greater fool 10 years in the future who will pay more for the asset?

Maybe that is one of the problems with this country?

Sounds speculative to me.

 

[bigbull338]

ill give you an expample of what people wants for land an what it really sells for.i know this guy that bought a 1500ac ranch for $1000 an ac.he hired a fencing crew to repair an build new fences so he could break the ranch into smaller tracts an sell it.he also put nice gates an entrances to the pastures.an they also torn down the old dairy that was there.as well as a set of working pens.he started out wanting $2500 to $4000 an ac for the ranch in smaller tracts.an they ended up selling it all togather for $1500 an ac.they barely broke even on that deal in my eyes.

 

[EAT BEEF]

So people just indefinitely overpay for an asset relative to its earning power, because there is a greater fool 10 years in the future who will pay more for the asset?

Maybe that is one of the problems with this country?

Sounds speculative to me.

Sums it up pretty good.

So what do you think you can pay?