Reasonable time expectation to get to "Break Even"

[newrancher]

You can do a lot with a little if you set your mind to it. Will the amount of cattle you can run pay for the place?, probably not.Can you grow enough food for your family to make your grocery bill practically nonexistent?, definitely.Will the money you save on groceries, and being able to take small business and ag deductions on your taxes help your yearly bottom line ? yes. Consider all options, tree farm, truck farm, poultry,etc. It all depends on you and how bad you want to make something happen, how tight you are with a dollar.

 

[Aaron]

One of my nearby neighbours (and a friend) and I were talking about profitability a couple weeks ago. He runs 60 Gelbvieh x Red Angus cows. His profit forecast this year will be around $30,000. That is after deductions such as $3,000 in taxes and $10,000 in fertilizer, fuel, etc. I don't remember the land base he is running on, but i think it is 3 quarters. He had an experienced farm accountant from Saskatchewan come in and look at his bookkeeping and the fellow said he was the most profitable cattle operation he had ever audited.

A few years ago, he calculated his take home wage at $67.xx a day, based on 7 days a week.

However, management-wise, he is similar to us in that he backgrounds his calves to yearling and practices holistic ranching. We both agree that selling calves off the cow truly is 'working for nothing', yet the majority of producers locally still think they have to cut hay with a 16 ft. discbine on a new 140 hp John Deere 4WD tractor...and still wonder why they can't turn a profit.

There is money in cattle. However, be prepared to use unconventional practices to achieve this goal and be happy to be labeled as 'weird/strange' by the local 'coffee row'. :cowboy:

 

[Limomike]

However, management-wise, he is similar to us in that he backgrounds his calves to yearling and practices holistic ranching. We both agree that selling calves off the cow truly is 'working for nothing', yet the majority of producers locally still think they have to cut hay with a 16 ft. discbine on a new 140 hp John Deere 4WD tractor...and still wonder why they can't turn a profit.
There is money in cattle. However, be prepared to use unconventional practices to achieve this goal and be happy to be labeled as 'weird/strange' by the local 'coffee row'. :cowboy:

Aaron, You do have a point there, because I notice that even at the sales barns, they announce the buyers when a group of steers comes in that have been weaned and vaccinated. ....and they always get a better set-in price, and go well above the usual calves being run thru.

 

[apical meristem]

On that landbase, I would recommend horticultural crops or orchardseaches, blueberries, blackberries, dewberries, roses, or just plant the thing in pine trees if you can and forget about it.

 

[gabby]

To be in the cow business ya gotta love it cuz you sure ain't doin' it for the money!!

 

[dcara]

Just a few quick thoughts
First, forget the land cost. The land should be considered a separate investment, not part of the operation cost. Second, you didn't mention a water source for the cattle. Third, if you want to be able to claim your "costs" on your taxes your going to need a business plan and actually show a profit at some point or Uncle Sam will declare it a hobby and may want you to come up with alot of back taxes someday. Finally, I live east of Dallas and due to our growing season our area might support 1 cow per 2-5 ac DEPENDING on your specific forage base. Just because there was something growing out there doesn't mean cattle can thrive on it. You probably don't need a tractor except to move hay to the cattle in the winter unless you can come up with another way to move it.

Alternately, you might consider just getting the fencing and water issues taken care of and running preconditioned stockers on it from about March thru Oct (i.e no haying required). Area sale barns will deliver them, and come round them up when your ready. You may not make much but it will get you started and you'll experiance the joy (and maybe some agony) of having cattle.

 

[HerefordSire]

Can you afford more land? If not, you could increase the quality and risk of the animals being purchased. So instead of the value of cow A being X, the cow's value could be 5X. It would take allot of money to fill a 25 acre pasture at one cow per acre and you buying your hay. You could even consider flushing these valuable cows, and hire recipients off of your land. The options are endless.

 

[HerefordSire]

I didn't figure on it being a pretty picture. I guess the question should be better phrased as to what income could I expect to help offset my expensive hobby. Great replies thus far. Thank you.

Beauty is in the eye of the beholder not the teller. When looking through your eyes I can see many valid exciting avenues to take. Cash flow is the key. If you and your wife are filing taxes jointly you should be able to obtain a 100% tax refund if both of you are fully employed outside. Therefore, even if you lose money accounting wise, you still might have extra cash that you don't have now. The government is willing to do this because the estate tax will capture half of your hard work and mainly half of your appreciable land provided you are worth a minimal amount when you die.

 

[grannysoo]

Don't be discouraged. Goats are good, chickens are good, throw in a few pigs, sheep and rabbits and you'll find that everything can work together for good.

You're not going to get rich off cows. You will be lucky to break even.

But... considering the tax breaks, improvements to the farm, and the peace of mind that you can find, it's PRICELESS!