Neighbor's cattle profits

[agmantoo]

Hondac

Would you like to make some predictions for me on the stock market? You are good!

The chicken litter is from a layer house and comes with calcium in the litter so I have not had to add lime in more than ~5 years. Parmak fence chargers use very little electricity. Miscellaneous supplies are minimal, pocket change. Otherwise you are not off very far and cattle prices are up and calf health is great with the pastures being rotated to "clean" ground.

 

[Hondac]

I tried to be conservative in my "guesstimations". I used $1.25 even though recent prices have far exceeded that. Are most of your expenses "in the ballpark" with my extimates?

 

[alisonb]

Agmantoo - I admire your methods and I remember being impressed with your cattle and setup when you posted pics some time back. Looking at Hondac's figures or as he rightly says 'guesstimations' I see pertinent expenses that have not been accounted for. The first alarm went off when I saw the expenses were far less than 50% of the income, could that be correct. Tax preparers/accountants also come at a price.....for a reason.

 

[TexasBred]

Agmantoo - I admire your methods and I remember being impressed with your cattle and setup when you posted pics some time back. Looking at Hondac's figures or as he rightly says 'guesstimations' I see pertinent expenses that have not been accounted for. The first alarm went off when I saw the expenses were far less than 50% of the income, could that be correct. Tax preparers/accountants also come at a price.....for a reason.

A D=5 dozer sitting still is a dead expense too and when running sucks a world of diesel as does the other piece of equip. Then there is depreciation on each. I understand an operation like Agman's has a very good chance of success in his part of the world but would be out of the question in mine. I can't run a cow or more per acre 365 days a year.

 

[dieselbeef]

this thread is winging it and full of speculation at best

wheres hook..he oughtta be postwhoring this one to death

 

[HDRider]

Having read and studied Agmantoo's posts on this site as well as others, following is my personal "Guesstimate" as to his profitability with his operation as it is NOW. Land costs are not considered and neither are the investments he made to get to where he is NOW.

INCOME (cash):
I assume that Agman's 100 momma cows yield 90 marketable calves per year at 550 lbs. each
He keeps 10 heifers to replace lost or culled cows and sells the 80 remaining
Calves sold yield an average price of $1.25 per lb.
Cull cows yield an average price of $700 each

80 calfs x 550 lb. x $1.25 = $ 55,000.00
8 cull cows ( 10 minus 2 died) x $ 700 = $ 5,600.00

Total Cash Income = $60,600.00

EXPENSES (cash)

Chicken litter for 30 acres = $1,800.00
Lime as needed = 2,000.00
Fuel for clipping, dragging, etc. = 1,920.00
Maintain tractor & equipment = 1,920.00
Transport to market costs = 800.00
Electricity for fences = 600.00
Insurance Liability = 1,000.00
Water (and related expenses) = 2,000.00
Salt & Minerals = 2,000.00
Seed = 2,000.00
Fence repairs, etc. = 1,000.00
Misc. Expenses = 4,000.00

Total Cash Expenses = $21,040.00

Net CASH gain from operation = $39,560.00

This is MY view on Agman's methods and I hope to one day achieve similar results.

By my calculation that is better than 65% net margin. Good by any measure and suspecting it might even be better...

 

[backhoeboogie]

Those numbers look real to me as well.

 

[TennesseeTuxedo]

Forgot property taxes.

 

[Hondac]

Forgot property taxes.

Notice that I said land costs were not considered. Property taxes exist on any pirvately owned land
regardless of what it is, or is not, used for.

 

[Anonymous]

this thread is winging it and full of speculation at best

wheres hook..he oughtta be postwhoring this one to death

Right here :wave:
I said my piece as I saw it and now it's pointless to argue one way or another. It's been interesting to read though

 

[dieselbeef]

to say the least...........

 

[agmantoo]

TexasBred

A D=5 dozer sitting still is a dead expense too and when running sucks a world of diesel as does the other piece of equip. Then there is depreciation on each. I understand an operation like Agman's has a very good chance of success in his part of the world but would be out of the question in mine. I can't run a cow or more per acre 365 days a year.[/quote]

I do depreciate all my machinery and I keep most of it until it is depreciated. I need the deductions. As for the last sentence, I hear the same remarks from my neighbors. I also hear from my neighbors "I do not have as many acres as you have". Try to explain that on a per acre basis they could carry the same number as I can carry on a per acre basis. They just look at me with a puzzled look per my interpretation. You will not know what your potential is until you try. Maybe you will not match because each person and place are different. On the other hand, maybe I will be seeking ideas from you in the future.

 

[agmantoo]

Hondac

IMO you came close to covering all of the expenses and there still remains funds that more than covers any expenses omitted. I consider the land to stand for itself. It has appreciated over the years and if sold the gain would be a great percent of return on the original purchase price. Already I have made public more of my personal financial business than most here would reveal of theirs. Anyone wanting any more financial information will need to PM me. I am taking the laundry from the clothesline.

 

[Hondac]

Hondac

IMO you came close to covering all of the expenses and there still remains funds that more than covers any expenses omitted. I consider the land to stand for itself. It has appreciated over the years and if sold the gain would be a great percent of return on the original purchase price. Already I have made public more of my personal financial business than most here would reveal of theirs. Anyone wanting any more financial information will need to PM me. I am taking the laundry from the clothesline.

Thanks, I appreciate your honesty and your willingness to share the knowledge you have gained thru real life experiences. I no doubt will be seeking your advise in the future as I prepare to phase into your method of making a small farm profitable.

 

[TexasBred]

Forgot property taxes.

Not to mention land acquisition unless you inherit it and to run the number of head he's running it's have to buy considerably more of it which mean depleting cash reserves or having a debt servicing expense. Then the last question "Can you raise a family on $39000 a year and replace things as they wear out.

OH and as of today you have eitehr a new hospitalization premium or a penalty to pay.

 

[TennesseeTuxedo]

Still a long way from $100 a head in profit.

 

[J&D Cattle]

OH and as of today you have eitehr a new hospitalization premium or a penalty to pay.

Excellent point, ha ha. I'm in the insurance business and this has been and will continue to be a nightmare.

 

[HEREFORD ROADHOG]

herofan, what state do you & your neighbor live in? how many acres does your neighbor have for this operation ? just curious, because I know it will take much much more that 500 dollars wort of hay to feed my " herd",of 1/2 that size for this year.I believe he is missing several expenses in his figures. :nod:

 

[TexasBred]

OH and as of today you have eitehr a new hospitalization premium or a penalty to pay.

Excellent point, ha ha. I'm in the insurance business and this has been and will continue to be a nightmare.

and you just thought you're job was hard before. ;-)

 

[Massey135]

If anything, land taxes should go as a credit- meaning a credit of the difference you would be paying if not for your ag exemption.