To much land

[polledbull]

Well the start up cost is enourmous . It can be done , but you need to already own the land .Around here they are building chicken farms as fast as they can go. Dont expect to make alot of money until they are paid for. You can do pretty good then.It does help to have some other farm income or income from a job .Most of the folks round here already have farming or other livestock operations when they built the chickens.

 

[Beefy]

just breed what you have for now. buy when prices go down. mix and match to get the best quality cattle you can.

 

[Texas PaPaw]

sambo

Good advice from Bez" and others on this board.
If you want other good business info on the cattle business, i would suggest the book "Knowledge Rich Ranching" by Allan Nation. It is a book on the business side of the cattle business, including finance, cattle cycle, cow-calf, stockers, etc. Also the "Stockman Grassfarmer" magazine.There are also several other good books available on thier website. You can request a free copy of the magazine on this site.

The attached link should get you there.
http://stockmangrassfarmer.net/

Good luck and best regards

Brock

 

[cypressfarms]

I think Bez hit it best, but I would like to add that it's easier "growing up" than "growing down" if that makes any sense.

 

[msscamp]

I think Bez hit it best, but I would like to add that it's easier "growing up" than "growing down" if that makes any sense.

Not a bit, Cypress. Would you mind clarifying for me? Thanks!

 

[cypressfarms]

I think Bez hit it best, but I would like to add that it's easier "growing up" than "growing down" if that makes any sense.

Not a bit, Cypress. Would you mind clarifying for me? Thanks!

IMO it would be easier to start small and grow little by little. This person has access to 100 acres, but it doesn't mean he has to use it all with cattle. To jump in the deep end, buy cattle for the land, and then have the price drop (or any other unpredictable bad thing) could be disastrous. Once you've bought a "bunch" of cattle and the "necessaries" that go with them, it would be hard to go back to square one.

I'm still not sure if I'm explaining it well, MSSCAMP, but I am from Louisiana and therefore need my hands to talk. Just seems easier to start small and work your way up than to dive in the deep end and maybe hit bottom...

 

[msscamp]

Ok, I understand now, Cypress. I think that is what Bez! was saying, too. Prices are high now, but they WILL drop sooner or later.

 

[Beefy]

Say it aint so, Missy! say it aint so!!!

 

[Brandonm2]

I think Bez hit it best, but I would like to add that it's easier "growing up" than "growing down" if that makes any sense.

Not a bit, Cypress. Would you mind clarifying for me? Thanks!

IMO it would be easier to start small and grow little by little. This person has access to 100 acres, but it doesn't mean he has to use it all with cattle. To jump in the deep end, buy cattle for the land, and then have the price drop (or any other unpredictable bad thing) could be disastrous. Once you've bought a "bunch" of cattle and the "necessaries" that go with them, it would be hard to go back to square one.

I'm still not sure if I'm explaining it well, MSSCAMP, but I am from Louisiana and therefore need my hands to talk. Just seems easier to start small and work your way up than to dive in the deep end and maybe hit bottom...

On the other hand (just to play Devil's Advocate) if all you can afford is 4-7 cows and you have to maintain 100 acres of fence, repair/pay for a tractor, bushog, hay equipment, working pens, barn, etc; fertilizer; and pay property taxes you are PROBABLY going to lose money on that handful of cows especially IF you are keeping every heifer calf. And that little herd is going to be that much bigger a burden in a few years (the latest U. prediction is 2009) when the cattle cycle goes into a down dip. IF you have the off farm income that you can lose $1000-5000 a year every year while you start small and add females as nature and the market allows go THAT route; but if you don't, running cows could be more of a struggle than it is worth. On the other hand, somebody who (evil word here) "BORROWED" $35,000 to buy a decent set of 50 cows would "probably" make money in this high end of the cattle cycle (not holding heifers back) and knowing that a downturn in cattle prices is a few years down the road have that debt payed down from his cattle income and NOT have to have his real world job pay for his cattle hobby indefinitely. Sometimes profit can be found IN debt....and sometimes not, but I would not automatically assume that avoiding debt is the best and only answer without looking at the numbers.

 

[cypressfarms]

Brandon,

Always love playing devil's advocate, but it does force one to consider the goods and bads of both sides. However, if a farmer in this case would take the note on your $35,000 loan and buy that amount of cattle every year, the farmer would come out ahead without making the bank rich.

One sure way to make people see how much money that's going to the bank is to multiply the annual percentage rate times the years financed.

 

[cypressfarms]

On the other hand, somebody who (evil word here) "BORROWED" $35,000 to buy a decent set of 50 cows

Sorry for the double post, but Brandon, you have a lot of "decent" $700 cows in your area? Devil's advocate kind of opens you up to being picked on.

 

[Brandonm2]

IF you have got $35,000 sitting IN the bank by all means go ahead and buy the cows. My example assumes that one doesn't.

Let's throw some numbers out there..
Lets say you have gotten 100 acres and you pay tax at $5 per acre (I am just guessing about NC taxes) and minimal fertilizer needs are $25/acre per year and the cost of clipping those fields (including tractor repairs) is $15/acre per year and maintaining the fences requires 10 t-posts and 4 rolls of wire /year.
So $500 taxes + $2500 fertilizer + $1500 machinery cost + $150 fence repairs = $4650 per year in maintenance costs whether he has 1 cow or 50. IF he has 5 cows they need
Vaccinations + dewormer = $30 each (incuding the calf + ~half that number is ivomec)
ear tags = $2
feed = ~3 rolls of hay + 4 sacks of feed + year round mineral
or ~$110
So each pair is another $142 in costs (and I think I am too low with that number)
so 5 head is $682 in direct per animal costs IF you never called a vet out for anything which I doubt so throw in another ~$110.
Now we are spending $4650 + $792 or $5442 per year. If all he sales are the bulls then he markets 2-3 calves at ~$600 per calf. Of course keeping those heifers means additional costs in feed and vet bills and he has to have a bull somewhere (unless he AIs which has it's own costs) so factor in $150/hd in heifer development costs plus bull maintenance of $150/year plus $700 for the prorated cost of the bull (who has to be replaced every 3 years to avoid inbreeding).
$5442 + (2*$150) + ($150+$700) - (3*$600) = a net loss of $4822 a year. Granted eventually he will have enough cows to pay the bills; but that will be after absorbing a lot of years of out of pocket losses.

 

[Brandonm2]

On the other hand, somebody who (evil word here) "BORROWED" $35,000 to buy a decent set of 50 cows

Sorry for the double post, but Brandon, you have a lot of "decent" $700 cows in your area? Devil's advocate kind of opens you up to being picked on.

Granted this market is definitely a seller's market; but give me $35,000 to flash in a lump sum and a month's time to bargain and yes I do think I can come up with a set of 50 commercial cows, or certainly a good set of heifers.

 

[Bez!]

On the other hand, somebody who (evil word here) "BORROWED" $35,000 to buy a decent set of 50 cows

Sorry for the double post, but Brandon, you have a lot of "decent" $700 cows in your area? Devil's advocate kind of opens you up to being picked on.

Granted this market is definitely a seller's market; but give me $35,000 to flash in a lump sum and a month's time to bargain and yes I do think I can come up with a set of 50 commercial cows, or certainly a good set of heifers.

Good for you - but remember the most important aspect of this whole thread. This guy is new to the game.

We need to answer the question with his lack of experience always in mind.

So while all of you folks come up with good potentials - does the new guy have the knowledge and capability to put the big bucks on the line?

Which one of you would be willing to step into something you know very little about and put down a feed sack full of cash and them HOPE all goes well?

Bez!

 

[bigbull338]

ive sat here an read all these good points.an heres what he has to start with.100acs an 10 cows.so all he has to pay are the taxes an ins on the place.if he can do that outta his pocket he is way a head.then take the 10 calves sale them.that gives him $5500 give or take. take that money an buy 5 cows.gives him 15.an by 2008 if he do that he will have 30 cows.an they be paid for.

 

[Bez!]

ive sat here an read all these good points.an heres what he has to start with.100acs an 10 cows.so all he has to pay are the taxes an ins on the place.if he can do that outta his pocket he is way a head.then take the 10 calves sale them.that gives him $5500 give or take. take that money an buy 5 cows.gives him 15.an by 2008 if he do that he will have 30 cows.an they be paid for.

Seems you and I agree - and he has income from his hay and leased land until he needs the land for himself. May not have any out of pocket expenses if he takes it slow and careful. Plus has a little bit of good luck when he needs it.

Bez!

 

[bigbull338]

well the way i see it he has a starting herd.so use that an buy a few cows every year.an in 4yrs he will have a herd.he has the main outlays already.land cattle an some equipment.

 

[preston39]

sambo....,

Good advice on this thread.

I wouldn't advise to go the heifer route..... for the inexperienced.....to many pitfalls and takes too long to get started.

Take the revenue from the cows you have and from hay sales,timber sales, fireplace heating wood sales,etc., and buy 3 in ones. Cow,calf and bred back. You can turn the calf in 4-5 months and buy more cows.(From your comments I concluded you have other job/income to provide for the family because 10 cows wouldn't do it)

If you have extra pasture see if a commercial herd guy near by needs pasture....rent what you dont need. If he/she knows you will keep a good eye on the animals it's a win win situation. Ask to include a bull with the herd as part of the deal...a big savings and allows you to have another cow in your overall plans. Some guys may buy exra cows if he knew pasture was available.

It has been done before...don't give up and good luck.

 

[lilbitfarm]

sambo you may want to go to the sale at Siler City some monday or friday and look at try'n to maybe buy some cow calf pairs some times you can buy them at a fair price feed them a little while and then resell them later or just sell the calf and almost paid for the pair. but get thier before sale time to look them over they are pened under the catwalk in pen 53 or 54 and sale after the goats & baby calfs about 11:00am on fridays & 1:00pm on mondays & good luck what ever you try.

 

[Bez!]

sambo you may want to go to the sale at Siler City some monday or friday and look at try'n to maybe buy some cow calf pairs some times you can buy them at a fair price feed them a little while and then resell them later or just sell the calf and almost paid for the pair. but get thier before sale time to look them over they are pened under the catwalk in pen 53 or 54 and sale after the goats & baby calfs about 11:00am on fridays & 1:00pm on mondays & good luck what ever you try.

Just what I would reccommend a newbie NOT do.

Good way to lose his shirt. Sickness, poor doers, poor conformation, poor health - and a ton more pitfalls for someone with no expeience to fall into.

And, you like the ability to pay off or nearly pay off the animal with the calf? I do as well - but if the calf dies, or prices dive you are now in a loss situation.

Let's keep this fellow in the black as much as possible - and NEVER FORGET - he is new to the game - would you do this or advise a friend to do this if you or your friend knew nothing about cattle - other than to look at them?

Sale barns and sales are for those in the know, those who are experienced or those who do not mind the odd financial loss.

I somehow think he is not one of the above.

Bez"