Neighbor's cattle profits

[Caustic Burno]

of the 10k plus members on here,, i wonder what percentage actually make their living raising cattle.. i can think of maybe a handful

Not me I make money off of stock but it is not much off livestock.
I have owned cattle most of my life, and required the girl's to pay their way.
Last year was an exception and I had welfare cattle during the drought and still turned a profit due to destocking.
But I am tighter than a crab's ass and that is waterproof.

 

[herofan]

I'm sure I won't profit from my first sale of calves because I had the cost of buying the heifers and some "start up" items. I decided to look at my expenses so far, minus the cost of the 16 heifers, and it totals $3,473. I keep and count every receipt that has anything to do with the farm. A "huge" part of that expense was fencing, which hadn't been touched in 10 years. The fence wasn't the greatest even then, so a lot of areas got all new fence, which is now completed. It includes last winters hay and hay already set aside for the coming winter, vet, fuel, feed, mineral, repairs, fly control, and some misc. items. That's a lot more expense than my neighbor reported, but he didn't have to fence 130 acres, so I won't have that expense next year. I also put out some feed in addition to hay last winter, but I plan to only feed hay this winter.

 

[Caustic Burno]

I'm sure I won't profit from my first sale of calves because I had the cost of buying the heifers and some "start up" items. I decided to look at my expenses so far, minus the cost of the 16 heifers, and it totals $3,473. I keep and count every receipt that has anything to do with the farm. A "huge" part of that expense was fencing, which hadn't been touched in 10 years. The fence wasn't the greatest even then, so a lot of areas got all new fence, which is now completed. It includes last winters hay and hay already set aside for the coming winter, vet, fuel, feed, mineral, repairs, fly control, and some misc. items. That's a lot more expense than my neighbor reported, but he didn't have to fence 130 acres, so I won't have that expense next year. I also put out some feed in addition to hay last winter, but I plan to only feed hay this winter.

Ok let's go with your number's so far where are the taxes? You don't insure anything ? Equipment, barn's etc ?
Let's say you sell you calf crop for 750 a piece normal year is a 90% calf crop. so you sell 14 calves for 10,000 roughly.
You are down to 6500 dollars and you have left a lot off your spread sheet.
Where is your truck cost on these cow's everytime you crank a vehicle to go get something for the farm has a cost.
Where is the trailer to transport the calve's it has a cost. I don't even like to think about all the tire's and batteries on this place that are associated with a cow. You haven't even counted the cost of the heifer's.
So you lost your butt this year. If you paid a 1000 dollars a heifer you bank account is down 10,000 dollars after you did your repairs and your cost so far. With your minimal cost figureing you won't break even for two years on your cow's with the number's you are using now.
It's about what is in the checkbook at the end of the month. You really want to find out what cattle cost open them an account and they have to keep a balance in the checkbook mine do or they don't get it. When they have to supply the froghides to keep the checkbook operating you will find out they are on welfare pretty fast.

 

[backhoeboogie]

I dunno CB. I think we should go talk to our neighbor's and engage them in a "casual conversation." I'll be sure to wear the hip boots. It might get a lil deep.

Now the cattleman neighbor down at the river, that's a different story. I'll need a big tablet if he's got the time. He does it for a living and knows his budget down to the last penny. Forget the boots. Better take a good pair of gloves cause we are going to be working our tails off the whole time we are conversing.

 

[herofan]

I'm sure I won't profit from my first sale of calves because I had the cost of buying the heifers and some "start up" items. I decided to look at my expenses so far, minus the cost of the 16 heifers, and it totals $3,473. I keep and count every receipt that has anything to do with the farm. A "huge" part of that expense was fencing, which hadn't been touched in 10 years. The fence wasn't the greatest even then, so a lot of areas got all new fence, which is now completed. It includes last winters hay and hay already set aside for the coming winter, vet, fuel, feed, mineral, repairs, fly control, and some misc. items. That's a lot more expense than my neighbor reported, but he didn't have to fence 130 acres, so I won't have that expense next year. I also put out some feed in addition to hay last winter, but I plan to only feed hay this winter.

Ok let's go with your number's so far where are the taxes? You don't insure anything ? Equipment, barn's etc ?
Let's say you sell you calf crop for 750 a piece normal year is a 90% calf crop. so you sell 14 calves for 10,000 roughly.
You are down to 6500 dollars and you have left a lot off your spread sheet.
Where is your truck cost on these cow's everytime you crank a vehicle to go get something for the farm has a cost.
Where is the trailer to transport the calve's it has a cost. I don't even like to think about all the tire's and batteries on this place that are associated with a cow. You haven't even counted the cost of the heifer's.
So you lost your butt this year. If you paid a 1000 dollars a heifer you bank account is down 10,000 dollars after you did your repairs and your cost so far. With your minimal cost figureing you won't break even for two years on your cow's with the number's you are using now.
It's about what is in the checkbook at the end of the month. You really want to find out what cattle cost open them an account and they have to keep a balance in the checkbook mine do or they don't get it. When they have to supply the froghides to keep the checkbook operating you will find out they are on welfare pretty fast.

Oh sure, I realize my butt is in a sling for a few years due to the "start-up" costs, no argument there. Once things get established in a few years, however, it will be different, as it was with my neighbor. I won't have the cost of buying 16 heifers and fencing 130 acres every year. As far as going to town to get supplies, we don't make special trips for that unless it's an emergency; we pick up things on our way from work. As for the trailer to haul, I don't own one. We have a friend who hauls for us. Ten years ago he charged $20 to haul to the local barn. I'm sure that's went up, but I don't suppose it will be a huge dent. We have a traveling vet, so there is no haul to the vet. We don't insure equipment. As for tires, I can't say that is something we need regularly. I can't remember the last time we bought a tire for farm equipment.

Yes, I won't see a profit for some time because of the start up costs; I wish we had maintained a herd all these years, but that's another story that I won't bore you with.

 

[bigbull338]

unless you haul alot of cattle weekly.you dont really have to own a cattle trailer.our cattle trailer hasnt hauled a cow since 2000.been hiring a hauler to haul cattle.

 

[agmantoo]

herofan

You need to acquaint yourself with a good farm tax man. Already I would think you have qualified your land for farm tax use. States that I am familiar with set the rate based on the lands ability to produce. Pasture land is one of the lowest rates. Most states forgive the sales tax on farm products used for production. Your fence expense can and should be depreciated and over time you will recover the expenses for the fence. Your losses for start up can be carried forward to offset profits in the future. Carrying liability insurance in event an animal gets out and causes an accident is a good business practice. The premiums are a business expense that is deductible. If you have a farm vehicle solely used for the farm; the tags, insurance and upkeep is a deduction. Insurance premiums for farm items against certain loses can be held to a minimum by having high up front deductibles. Your start up period may be longer than you expect but even the heifers will have value when you ultimately remove them from the herd. As a farmer purchased stock held for profit can be taken for a lost should one die. Buying a young bull bought at a modest price and later sold, after a few years of breeding, for more than you paid for him will create a long term capital gain which is currently at 15%. Heifers calves retained for your herd will be equity that you are building in you business. It is not uncommon for a farmer to have marginal profits and yet have a sizable estate. You net worth will gradually improve over time. Do not hesitate to reinvest your profits in more land and cattle as you make it. Money is a tool and should be used accordingly IMO. Remember....."Have something working for you when you are not working".... A man with a second grade education told me that. Best information I ever received!

 

[Anonymous]

unless you haul alot of cattle weekly.you dont really have to own a cattle trailer.our cattle trailer hasnt hauled a cow since 2000.been hiring a hauler to haul cattle.

At 3 bucks a mile round trip for hauling here it doesn't take long to pay for a trailer you own and can resell as an asset. that said I'm getting ready to pay to have some hauled because The fee is less than the fuel
I would use because his trailer can haul 3 times what mine can.
Other than that I hate borrowing equipment or trailers.

 

[TexasBred]

unless you haul alot of cattle weekly.you dont really have to own a cattle trailer.our cattle trailer hasnt hauled a cow since 2000.been hiring a hauler to haul cattle.

At 3 bucks a mile round trip for hauling here it doesn't take long to pay for a trailer you own and can resell as an asset. that said I'm getting ready to pay to have some hauled because The fee is less than the fuel
I would use because his trailer can haul 3 times what mine can.
Other than that I hate borrowing equipment or trailers.

A lot of money tied up in something you never use. Sell it.

 

[Anonymous]

unless you haul alot of cattle weekly.you dont really have to own a cattle trailer.our cattle trailer hasnt hauled a cow since 2000.been hiring a hauler to haul cattle.

At 3 bucks a mile round trip for hauling here it doesn't take long to pay for a trailer you own and can resell as an asset. that said I'm getting ready to pay to have some hauled because The fee is less than the fuel
I would use because his trailer can haul 3 times what mine can.
Other than that I hate borrowing equipment or trailers.

A lot of money tied up in something you never use. Sell it.

Yeah I should. Hauling hay, cows, pigs, moving my friends and relatives, etc.
I'm losing my ass on it. Look for it on cl. :cowboy:

 

[dun]

The hay equipment is in the same category as the trailer for me, I have it so that I can do things when I want to instead of when I can get someone else to do it.

 

[Brute 23]

There are people who calculate thier earning the same way as if they were buying stock. They seperate out (1) costs like equipment, cattle, land, fences ect from (2) operating expences like feed, diesel, vac, ect. The first set is your principal investmentment. Your revenue is your gross rate of return. You subtract your operating epences (2) from your gross RR to get your net rate of return. When you figure you get tax depreciation on the investment, your land is increasing in value and other factors its not so bad.

Its a wealthy mans game.

 

[Stocker Steve]

The hay equipment is in the same category as the trailer for me, I have it so that I can do things when I want to instead of when I can get someone else to do it.

There are three reliable truckers around me so that is not a problem.

There are also three custom hayers around me. One is very unreliable, and the other two are ex dairymen who will do yours after theirs if you call daily to give direction... They are good operators but with the kind of rain we usually get in late May and June this after theirs approach is a real mess, and I make it worse by putting some clover in the mix. So I think a better way to approach this is to buy a wrapper rather than be disappointed in the lack of drying weather.

I put planting equipment in the same category - - just too small of a weather window most years to do a lot of sharing and get top results.

 

[ALACOWMAN]

]The hay equipment is in the same category as the trailer for me, I have it so that I can do things when I want to instead of when I can get someone else to do it[/u].

exactly...

 

[alisonb]

Did anybody mention labor or is that for free as well?

 

[agmantoo]

As the owner/operator there is no hired labor except mine. All profit goes to the owner/operator and that is me! I market calves year round to smooth out the cash flow and to attempt avoiding selling into a possible down market with the entire crop.

 

[ALACOWMAN]

Did anybody mention labor or is that for free as well?

thats the enjoyment of the business... you know when your cutting out a wadd of hay, thats got your baler locked down tight as wedge,, pulling a breech... working em, doctorin',and thinking God i love this life

 

[dieselbeef]

chasin em thru gates they destroyed..in the pouring rain....for 2 weeks

 

[ALACOWMAN]

chasin em thru gates they destroyed..in the pouring rain....for 2 weeks

there something else,,, constant maintenance of infrastrutures destroyed by em.... what they don't break...... they sht on

 

[TexasBred]

[Yeah I should. Hauling hay, cows, pigs, moving my friends and relatives, etc.
I'm losing my ass on it. Look for it on cl. :cowboy:

You're doing fine Hook....Bull hasn't used his in over 10 years for anything. Probably needs 4 or 6 new tires by now.