Starting A Farm from scratch.

[wjason777]

Hello,

I'm a veteran that recently discharge from the military. Im in the South Georgia area. Me and my wife are wanting to start are own farm to raise cattle. I recently saved up enough money to make a nice down payment on some land. There is two parcels that we have are eye on one is 10acre for $45k and the other is about 20 acre s for $42k they are in opposite directions from each other. Both are cleared and zoned for ag. We are more than likely going to go with the 20 acre track. Before we even begin to think about buying the land we are doing as much research as possible, Im also writing a business plan.
After we pay for the down payment (25%) that's required for financing through the bank. We would have about $6k left over. Right off back we know we are going to need a nice used tractor and attachments, the land isn't fenced ,a well, corral, and a lot more I could imagine.
We both have careers so we are not looking to do this to replace are income, just a hobby, to learn and gain the experience.
My questions............
Is there any programs out there for veterans that the USDA have that could help us get started, purchasing equipment ?
Would this be a good way to start out?
Is there any advice you all could give me.
Thanks

 

[SteppedInIt]

First, thanks for your service and I wish you the best. I am still in the beginning stages of my cattle operation. The most valuable thing I have done is gain info/help/experience from seasoned cattlemen. I help them bail hay, fix fences, work cattle in exchange for a place to put my cattle while I am developing my own place. Cattle ownership actually came easy and grows quicker than I thought. Land is hard to acquire rather trying to lease or buy because my herd is growing quicker than gaining access to land. Having to prioritize your needs is hard. I have a long list of needs, but still don't own a tractor, working equipment, or even a cattle trailer. The networking and time I have put in working with the older guys, I find their willingness to let me borrow equipment, trailers and using their facilities and sell me hay at a much lower cost. Otherwise I would be in massive debt on my own. With their help I am able to pay cash for all I am doing now. Its definitely long term growth and acquiring things. I believe the key is keep it cash, buy only what is a must and only when you can afford it(cash).

 

[backhoeboogie]

Welcome to the boards.

It is tough to make it on 20 acres.

We all started somewhere. Keep your debt to a minimum.

If I was just starting, and with 20 acres, I would consider nurse cows. Raise beef calves on them. A tough start for a beginner but it is the best possible way to make it work, in my opinion.

 

[Calhoun Farm]

I wouldn't buy land right now, I'd take your savings and lease land. Use the money to buy cattle and get started and learn.

 

[grubbie]

In my part of the country, you couldn't raise enough cows on that acreage to even come close to making payments on the land. Seems to me your hobby will COST you money, not make you money. That is not to say it's not worth it, though. And thank you, for your service.

 

[Runaway Deere]

There are a lot of people that have to start from nothing. We all may have day jobs and some income other than cattle, but you have to start somewhere. We spent years in stockers, had really good luck. We were fortunate enough to grow our stash and move to cow calf. We made the move right before the $ spike. I would not feel comfortable with a $1500 stocker that we still only hustle $250 on. We decided the cattle business is like painting... You start out with a blank canvas and a full palet, how you build and design your program is up to you. The cattle industry stats say it all, we need younger ranchers as replacements for the future. Get your feet wet by finding someone that will let you help day work and perhaps you may find a mentor in that person. Once you get into a click advice and help May come pretty dog gone fast.

 

[branguscowgirl]

Welcome :tiphat:
Every piece of land is different. For me, the big savings was when I bought land that I could irrigate. Though it is much smaller than what I have ever had in the past, it yelds more feed and higher quality feed, than acreage I have had that was 10 times larger. So I think quality of the ground is more important than size, especially if your cattle volume is small starting out. You can always grow later.

 

[wjason777]

Thanks guys for all the replies. Its very tough starting out with absolutely nothing but the will power and wanting to learn farming.

 

[wjason777]

Welcome to the boards.

It is tough to make it on 20 acres.

We all started somewhere. Keep your debt to a minimum.

If I was just starting, and with 20 acres, I would consider nurse cows. Raise beef calves on them. A tough start for a beginner but it is the best possible way to make it work, in my opinion.

This is not a bad idea,

 

[wjason777]

What about fencing? Lets say I have the 20 acres already but didnt have the extra money to pay to get it fenced in. What are somethings i could do with the land that would generate money that i could save.

 

[SteppedInIt]

That's the fun part about this business. Figuring how to make things happen and spending the least amount of money possible. There is a possibility of haying it, but unless you purchased equipment you might have to find someone to bale it for you. If it was me, and I wanted cattle on it, I would just start building the fence. Buy the material you need, as you go when, you have the money.

 

[Engler]

I don't know if there are any programs just for vets, however I think that in most cases being a vet does get you moved to the top of the list for funding. One FSA program that I know of is the 5-45-50 program where you have to put 5% down, get 50% of the funding from a conventional lender (bank) and FSA will lend you the remaining 45% at pretty good terms (currently 1.5% fixed for 20 years). Different states may have some programs for beginning farmers and/or vets that you can piggy back on to this. With as cheap as money is now, I would look at loading up the farm with longer term debt then using your cash for improvements, machinery and livestock purchases. Rough math the principal and interest on the land loan (40k) is going to run you about $2,500/year. I know a lot of people will advise against debt of any kind, but if you are going to have debt long term, structured, fixed rate is better than 3-5 year stuff that the interest can go nuts on.

Next, find someone smarter than you-no disrespect intended. We can't be experts in everything, so find a chemical guy that you trust, find a good mechanic, find a good vet(the other kind), and so on.

If you can find that mentor that is willing to take you under their wing remember that we have one mouth and two ears for a reason. Don't be afraid to ask question, but don't question everything.

Good luck

 

[xbred]

what did you do in the service?

 

[Craig]

Not saying to finance through them, but spend a couple hours at the FSA office talking to a loan officer. Ask them about a farm business management program in your area. Doesn't cost anything to talk to them but time, and it will be a real eye opener.

 

[Nesikep]

As much as I don't like debt, Engler has a good point, if you can get the 5/45/50 deal, that's a reasonable way to start off, especially on a 1.5% locked in for 20 years... That's pretty much inflation only. Using the extra cash to set up a fence would be a good start. Perhaps rather than haying the place, you could pasture cows on it... might not pay all that much, but would be cheap education and you could glean knowledge from the owner.
Depending on the shape of the property, fencing may not be that complicated for just a perimeter fence (I'd electric fence inside to start off). Remember that good fences make good neighbors, I like high tensile wire fences, as they're easy to keep tight and put a hot wire on, which will keep 99% of cattle smart.
If the property is square, 20 acres of perimeter fence would require about 3/4 mile of fence... so at 10 foot post spacing, 400 posts would about do... Around here a 4" post is about $7 (always go new for your perimeter fence!, used is fine for crossfencing), so that's $2800 in posts, but lets say $3500 since you'll want some heavy duty ones for the anchors... High tensile wire I can't remember the price on, but you'll need 5 strands, so about 4 miles of it.. ($100 for a half mile comes to mind, so that would be $800). Then comes installation, if you have soft ground, borrowing a post pounder might be the best way to go.

good luck