Lease requirements

[robertwhite]

I would want a set term like 3 or 5 years in a lease. In this area which is not far from Clarksville I would think it would be hard to pay more than $50-$60 a acre unless the ground is exceptional and still make a profit on a cow calf operation.

I live just a bit South of that land and there have been a LOT of farms up for auction this past year with prices well below what that lease would cost you in just five years or so.

There is no way that lease is worth it at even half the price IMHO.

If the family wants to find out how little that land is really worth, let them put it up for sale. I bet they would be shocked at what they would get in todays market. They are dreaming.

 

[tncattle]

I'm supposed to hear back from the owners about how many head it will hold. If it will hold 200 mama cows I might try and split it with a friend of mine but for no more than $40 an acre total. So around $15500 total a year for the whole thing. I'm thinking 100 black mama cows will gross around $60K-$70K a year, maybe? :???:

 

[robertwhite]

So around $15500 total a year for the whole thing. I'm thinking 100 black mama cows will gross around $60K-$70K a year, maybe? :???:

100 calves grossing $60-70K a year in TN? Maybe, if you sell them as 5 weights and are lucky enough to get $1.32-1.42 a head. But what is the net on that $60-70K after you take out for feed, shots, hay, etc., plus you are leasing the land.

What does the net come to, $10K? Sounds like a losing proposition to me. Someone please correct me if I am wrong.

 

[tncattle]

So around $15500 total a year for the whole thing. I'm thinking 100 black mama cows will gross around $60K-$70K a year, maybe? :???:

100 calves grossing $60-70K a year in TN? Maybe, if you sell them as 5 weights and are lucky enough to get $1.32-1.42 a head. But what is the net on that $60-70K after you take out for feed, shots, hay, etc., plus you are leasing the land.

What does the net come to, $10K? Sounds like a losing proposition to me. Someone please correct me if I am wrong.

You might be right Robert-- :???:

 

[Dixieangus]

As of now i think 100 mamas would gross 55k (maybe more? who know what the market will do?)
55,000-15500= 39,500
Hay- feeding 3 months a year at 40$(little high) for a 1000lb bale to 100 mamas= ABOUT 13,000
39,000-13000= 26,000
Shouldnt have to feed much since its such great pasture and for shots? Well ive never worked 100 mamas.
So you are looking at about 20,000 profit maybe less

 

[shaz]

12 bucks an acre has been norm for average land around here. You could go 18 if it's really good and the owner is reasonable.

I'd say run away from this one.
Seriously.

 

[tncattle]

12 bucks an acre has been norm for average land around here. You could go 18 if it's really good and the owner is reasonable.

I'd say run away from this one.
Seriously.

Where are you in middle Tn.? I've never found anything for $12 an acre. A good friend of mine leases about 350 acres and will pay $35-$40 an acre for good river bottom pasture. They want to get the lease done quickly so we'll see what happens, I'm in no hurry. I'll just wait awhile. More importantly I'm discussing with another man about managing his herd and living on his property because he lives out of state--that sounds more appealing because he's looking for a family that wants to be there long term.

 

[tom4018]

Don't think you find anything in my area for $12, we rented some 20 years ago for more than that.

 

[houstoncutter]

If you gotta think this hard on it, you need to run like hell

 

[Dixieangus]

. More importantly I'm discussing with another man about managing his herd and living on his property because he lives out of state--that sounds more appealing because he's looking for a family that wants to be there long term.

Sounds alot better

 

[shaz]

12 bucks an acre has been norm for average land around here. You could go 18 if it's really good and the owner is reasonable.

I'd say run away from this one.
Seriously.

Where are you in middle Tn.? I've never found anything for $12 an acre. A good friend of mine leases about 350 acres and will pay $35-$40 an acre for good river bottom pasture. They want to get the lease done quickly so we'll see what happens, I'm in no hurry. I'll just wait awhile. More importantly I'm discussing with another man about managing his herd and living on his property because he lives out of state--that sounds more appealing because he's looking for a family that wants to be there long term.

Marshall and Lincoln counties. The bushhogging is SCARY and the land is rocky. That's why 12 an acre.
There are also hunting properties that you can get for upkeep. Most of the land being bought is by out of state people using the 1041 tax law.

 

[bigbull338]

even with 2 of you thinking about that deal id walk away an not look back.because just to fert with 200lbs to the ac once will cost you $24,000.an boom your broke with in a year an ruined.

 

[tncattle]

even with 2 of you thinking about that deal id walk away an not look back.because just to fert with 200lbs to the ac once will cost you $24,000.an boom your broke with in a year an ruined.

I'm going to talk with the owners Wed. and try and negotiate the fertilizer out of the deal. He sent me a copy of a potential lease and said they are negotiable so I'm going to find out how negotiable they are. I don't think they are going to find anyone that will lease it for $35-$40 an acre plus fertilize, spray for weeds, bush-hog and keep up the fences. That does even count your other expenses like hay, meds, fuel, feed & mineral etc. Maybe someone will but I don't know how they can make any $ if they do.

 

[robertwhite]

I'm going to talk with the owners Wed. and try and negotiate the fertilizer out of the deal. He sent me a copy of a potential lease and said they are negotiable so I'm going to find out how negotiable they are. I don't think they are going to find anyone that will lease it for $35-$40 an acre plus fertilize, spray for weeds, bush-hog and keep up the fences. That does even count your other expenses like hay, meds, fuel, feed & mineral etc. Maybe someone will but I don't know how they can make any $ if they do.

Like I said before, I know the area and they are absolutely dreaming.

Tell them you will give them $15 tops an acre, no fert., no upkeep conditions, 1yr lease with YOUR option to re-up for years 2 & 3. (at $15ac, you could maybe see $5-8K a year profit on your 100 cow plan) If they balk, tell them good luck and watch for the auction sale this Spring (and the WILL be selling it, you can bank on that) Bet they don't get anywhere near $1K an acre at auction. We are talking 350ac if memory serves. I've seen that amount of land go for very low $200K this year.

 

[novatech]

If one could estimate the nutrient removal directly associated to the cattle then a fair price could be established as to the price per acre.
There are several conditions that effect this. Environment, type of forage, with or without legumes, rainfall, pasture management, stocking rate, etc.
There is certainly going to be a difference in nutrient removal as to weather it is a cow calf operation or a stocker operation. The more cattle sold the more removal = more fertilizer. In this senerio you coud come up with a per head sold agreement.
Another thing to consider is a more sustainable system of forage management planting clover, if it is not already there, where the N is being replaced. This is only if the environment lends itself to it.
Previously the man grazed 1 pair to a little over 5 acres. The question arises, Why?

 

[tncattle]

If one could estimate the nutrient removal directly associated to the cattle then a fair price could be established as to the price per acre.
There are several conditions that effect this. Environment, type of forage, with or without legumes, rainfall, pasture management, stocking rate, etc.
There is certainly going to be a difference in nutrient removal as to weather it is a cow calf operation or a stocker operation. The more cattle sold the more removal = more fertilizer. In this senerio you coud come up with a per head sold agreement.
Another thing to consider is a more sustainable system of forage management planting clover, if it is not already there, where the N is being replaced. This is only if the environment lends itself to it.
Previously the man grazed 1 pair to a little over 5 acres. The question arises, Why?

This is good and I will bring this up tomorrow when I meet with him.

 

[shaz]

1 pair per 5 acres is actually what I'm doing though I could probably double it.
Pasture to woods ratio may be the problem.

I have a co-worker who has 200 acres with only 60 in pasture. This situation is pretty typical and makes fence repair and upkeep rough.