Need Help!

[TR]

For what its worth, we have followed Hillbilly's plan to the "T", and so far so good. (knock on wood!) 15 acres are owned and 67 acres are currently leased with an option on an aditional 160 acres this January. We started with 4 bred heifers, and in 3 years have grown to 30 head by retaining all heifers born and by picking up a few quality bred cows at a time when the cash was available. So, all animals are paid for and owned. The tax situation is a dream as we are only taxed on the owned 15 owned acres and have the ag exemption on top of that. The main thing is that we each kept our day jobs so that when mistakes are made, and they inevitably will be when starting out, its not a matter of who eats that week. Basically we say that each share of our retirement "stock" has 4 legs.

 

[Brad B]

The land leasing is a good option. Especially if you can get a signed lease/purchase agreement. Not sure if it's the same in every state, but if you get a l/p agreement in AL, then you have the legal, right of first refusal if the landowner ever sells the land.

 

[Archer913]

Thanks again to everyone for the advice and guidance. It is all greatly appreciated. I guess it's time to put the thinking cap on.

 

[Archer913]

Can anyone give me a rough estimate of profit per head?????

 

[dun]

Can anyone give me a rough estimate of profit per head?????

75 bucks a head of momma cow is considered the number for pencil whipping purposes

dun

 

[Archer913]

$75 net profit, what would the gross profit be???

 

[dun]

Roughly 500. You have to figure the value of a calf for normal times, not the high prices of today. There was a report a while back that showed the difference between a loss for each cow to just over 100 bucks per cow based primarily on differences in managment. If I remember correctly it was in either Drovers or Beef-Cow Calf weekly

dun

 

[Campground Cattle]

I have found for every 5 calves sold it takes 2 or 3 to pay operating cost on 5 cows per year. Now I am established and everything is owned. With todays market thats 1000 to 1500 dollars profit on 5 mamma cows. There have been years also like during the 2000 drought it took the sales from 4 calves to support 5 cows. There is no exact formula with so many variables drought, floods, market swings, major equipment breakdowns and of course the loss of a cow/calf from time to time.

 

[plbcattle]

you don't need 500 cows to make a living. you can make it on 50/75 or even a 100. as with any business overhead is your main factor. the more cattle the more overhead. I don't know where you live but if you had enough money to buy 1000 acres around here, why the heck would you farm. if you keep your overhead low,raise quality cattle, and MARKET them properly you can make it on less. it just depends on how you control your overhead

 

[Archer913]

Thank you PLB that sounds a lot more realistic. I appreciate it. This really is all quite confusing for a rookie. Thanks again.

 

[Craig-TX]

overhead is your main factor. the more cattle the more overhead. I don't know where you live but if you had enough money to buy 1000 acres around here, why the heck would you farm. if you keep your overhead low,raise quality cattle, and MARKET them properly you can make it on less. it just depends on how you control your overhead

PLB, we might have our differences but I'll agree with you 100% on that comment. A lot more money is made in commercial operations by closely managing the dollars you put into operating cattle than is ever made on maximizing what you get out of them. I'm not saying you can starve a profit out of them because that never works. But most of the money is made on the front end of the equation.

Craig-TX

 

[Ryder]

you don't need 500 cows to make a living. you can make it on 50/75 or even a 100. as with any business overhead is your main factor. the more cattle the more overhead. I don't know where you live but if you had enough money to buy 1000 acres around here, why the heck would you farm. if you keep your overhead low,raise quality cattle, and MARKET them properly you can make it on less. it just depends on how you control your overhead

plb your comment on making a living on 50-100 head is interesting. I would think you are referring to seed stock business rather than commercial, or is it both. What are your specific thoughts on marketing and keeping overhead low? What areas do you think need to be watched for excess expenses?