taking over family farm

[lukelangford]

i'm taking over the family farm, could use some help setting expectations. Any help or suggestions would be appreciated. Here's my setup.

We have 1100 acres, roughly 950 in pasture. Currently run 300 head of mama cows, plan to run 650-700 at full capacity. Summer grass is tifton 9 bahaia with millet for feeder calves.Winter grass is rye/ryegrass. I don't intend to run any bermuda grass, instead plan on baling ryegrass. Facilities are top-notch, have pens, squeeze chute, scales, barns, etc. Most large expenses such as equipment and barns are already in place or accounted for. My biggest question is what kind of $$ should i expect to make from this operation? I would like to think there's a good living here, but i don't know that many rich farmers. There again, any advice would be helpful, especially anyone with a similar situation.

 

[Beefy]

why no bermuda grass?

 

[Bama]

How much experance do you have in the cattle business. Not trying to sound mean but you could be in for some surprises. Generally expect about 100 dollars per head profit. This is only a rough estament. Its how you manage your herd that effects your profits.

 

[lukelangford]

My thoughts are that since the growing season on bermuda is much shorter than tifton-9 (may-sept vs. april-nov), i would prefer to have more acres of bahaia for grazing and bale ryegrass during the winter. Has anyone tried this?

 

[lukelangford]

How much experance do you have in the cattle business. Not trying to sound mean but you could be in for some surprises. Generally expect about 100 dollars per head profit. This is only a rough estament. Its how you manage your herd that effects your profits.

My family has been in cattle since the 50's. We switched from dairy to beef in '91. We've kept the herd small up until now, now i'm trying to make a decision on where to go from here.

 

[stocky]

the profit can vary greatly from year to year, and the loss comes in at times also. sounds like you have a great operation to start out with. i would strongly urge you to really take a good, long look at your finances before trying to build up another 300 cows at the current prices. you could borrow a fortune and if the cow and calf market breaks, and it will someday, you could end up losing what you have. if it holds for a few more years, you can pay off those cows, but it depends on how much you want to risk. dont risk what you already have paid for in a record high market just to expand your numbers. expand wisely

 

[lukelangford]

don't intend to buy any, keeping replacement heifers.

 

[stocky]

luke, sounds like a good plan. i wish you the best of luck with it all, sure does seem to be a real nice operation the way you described it. sorry i dont know enough about florida to give you the financial estimates you are looking for

 

[denoginnizer]

If your cows and land were paid for would you still expect to only make 100 per head? I know management plays a huge role but lets say the person is better than average.

 

[Caustic Burno]

Thats the national average if you are really frugal you might do better, if no castrophes strike, or major equipment failures.

 

[Muratic]

Thats the national average if you are really frugal you might do better, if no castrophes strike, or major equipment failures.

Caustic knows all about strike. But then again he treats any employee he ever had worse than the neighbor's dog that bred his prize gyp.

 

[Bez]

lukelangford

Check your PM

Bez

 

[bubchub]

don't intend to buy any, keeping replacement heifers.

Luke,
If you were going to be building your herd here is an idea. Sell all of your bull calves for profit. Sell the heifers the heifers open for($500-$600). Take that money and buy some heavy bred cows that can have you some calves in 4 months or less. You are waisting 2-3 years worth of feed on those heifers while you could already be making money with the bred cows.

 

[Bama]

100 dollars per is just that, a average. Some make more some make less. I depends on your management and practices. Some people say hey I make 250 dollars per head all the time. Now figure in all cost. Gas, fuel, fences, medication, vet bills, feed, labor, structures, fertlizer, supplies, the list goes on and on.
The reason I was concerned about the cattle experience is that this is a huge undertaking you are talking about. Some folks think that this is a easy way to make a lot of money. I see that you have been around cattle for a while and are aware of the issues. As recommended by others I would go about building up cautiously. Keeping your heifers and not sinking a lot in loans is less risky than tieing up a lot of hard earned cash. It all depends on what the market holds in the future. None of us knows that for sure. I wish you the best of luck.

 

[jerry27150]

i would build up slowly till you see how well you do running the cattle & hired hands. profits drop fast when you start building fast

 

[Running Arrow Bill]

Expand (if you want to) VERY slowly and with $$ you earn (over and above what you need to live on & support cattle).

Don't borrow money to finance your operation. If you do, the only SURE thing in up/down economies, is that the BANKS always make & get their money... one way or another.

 

[preston39]

don't intend to buy any, keeping replacement heifers.

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lukelanford,

You may wish to re-think this point. Keeping heifers is a bad choice.

It will take 3 years to gain cash flow from them...IF you are blessed with breeding...birthing...moms....which is chancy. We give it about 65% chance of getting a good breeding cow. I don't know of any published stats available.

You will be far ahead of the game if you sell the calves and buy good cows with 100-150# calves by their side. In 5 months you can sell the calf and get almost 50% return back of what mom cost. You can have 150% gross returns on the cost of each mom with calf...before you have a calf to sell from the heifers.

Once you get the herd built up...keeping replacement heifers from good known, producing stock is another point to consider.

Your call.

 

[la4angus]

don't intend to buy any, keeping replacement heifers.

=========
lukelanford,





You will be far ahead of the game if you sell the calves and buy good cows with 100-150# calves by their side. In 5 months you can sell the calf and get almost 50% return back of what mom cost. You can have 150% gross returns on the cost of each mom with calf...before you have a calf to sell from the heifers.
Your call.

PRESTON
Please share with us what the price of calves will be 5 months after these mamma cows with calves at side are purchased. Is it an automatic almost 50 % of what the cow cost or do you have to announce at the sale barn or market what the cow cost you to realize this return.

 

[lukelangford]

My only problem with selling my heifers is that that will be a 2-1 return( 2 heifers produce 1 cow). In addition i have to pay 30% capital gains on these heifers i've sold. My costs on raising a heifer for 3 years are approx the same in my head, is there any research stating otherwise?

 

[preston39]

don't intend to buy any, keeping replacement heifers.

=========
lukelanford,





You will be far ahead of the game if you sell the calves and buy good cows with 100-150# calves by their side. In 5 months you can sell the calf and get almost 50% return back of what mom cost. You can have 150% gross returns on the cost of each mom with calf...before you have a calf to sell from the heifers.
Your call.

PRESTON
Please share with us what the price of calves will be 5 months after these mamma cows with calves at side are purchased. Is it an automatic almost 50 % of what the cow cost or do you have to announce at the sale barn or market what the cow cost you to realize this return.

=========
La4...,

Not sure if I understand the question.

Don't think anyone knows what the price will be 5 months ahead....if that is your question. Also, I doubt an announcement at the sale barn( :roll: ) would have any impact on buyers. I'm not sure of your question. Try it again..if you wish.