What to Charge for Lease?

[Moooooo]

I just registered today, and I need to become an expert in a hurry.

I have a small beef farm in northern Florida. I am told it can support around 3 dozen cattle. I need to get an agricultural project going so I can get a massive reduction in my property tax.

I was planning to have a guy cut my hay and leave it at that, but he says he's interested in putting cattle on the property. I wouldn't get any income from hay, but if I put cattle on the land, I will make a few dollars, and the cattle will help with the weeds and brush.

Here's my problem: I have no idea what to charge this guy. He says he'll mend the fences and do all the work. He expects to pay something. I don't have any farmer friends I can consult. Any ideas?

 

[5S Cattle]

If he's wanting to work and willing to pay, he sounds honest. He probably knows the going rate for the area. Around here it's $10-20/acre

 

[Brute 23]

Around $100 per head, + or - $25, depending on the facilities and what he is responsible for.

 

[sim.-ang.king]

$0.50 per head per day, if you have a natural water source, or maybe less. After all you're using him just for the tax benefits.

 

[Moooooo]

That's quite a range of prices. Ten bucks per acre would be about $300 per year. A hundred dollars per head is $1800. Fifty cents per head would be $3285.

I made an error when I said the farm would support three dozen cattle. I meant half that many.

He says he'll maintain the fences. I won't have to do any work or supply things.

The farm has a pond and an automatic water trough, so water is not a problem.

 

[Caustic Burno]

At a 100 bucks a head and maintenance those cows will be in the red.

 

[Moooooo]

I have no idea how much money a cow produces per year.

Maybe the people at the property appraiser's office would have some insights for me. They seem to know a great deal about how this stuff works.

 

[True Grit Farms]

Charge enough to cover the taxes and insurance.

 

[snoopdog]

Go to your county extension agent, he'll know the going rate.

 

[Brute 23]

Per acre prices are useless. I can show you a 100 ac property that is lucky to support 10 pairs. I can show you another 100ac property that supports 30 pairs no problem. Your either leaving money on the table or settinging the leasee up for failure.

Our own county agent tells landowners on a regular basis land is worth $20 an acre. A lot this land requires 10-20ac per pair. Those numbers are impossible. When the land owner doesnt make a deal with the original prospective leasee he swoops in and offers to take a look at the property. He changes his tune after looking at the property and under cuts the original person.

 

[JMJ Farms]

I'm in Georgia. I pay $30/ac. I wouldn't pay more than $50 per head per year. Not counting calves either.
30 acres @ $30/ac = $900
18 head @ $50/hd = $900
I'd say $900/year. But I second the advice to talk with your local extension agent first.

 

[Caustic Burno]

Drovers has profit at 67 bucks a year.
https://www.drovers.com/article/cattle-prices-and-profitability-2019

 

[JMJ Farms]

Drovers has profit at 67 bucks a year.
https://www.drovers.com/article/cattle-prices-and-profitability-2019

That's a good guideline for the OP to follow. Rates should be set $50 higher per cow than the drovers article has figured. That way the cattleman makes $17/hd profit. Do your part to make sure the cattleman makes just enough to convince himself that next year is gonna be better while you make the dime on his hard work :lol2:

 

[Brute 23]

Drovers has profit at 67 bucks a year.
https://www.drovers.com/article/cattle-prices-and-profitability-2019

That's in Tennessee I assume? Our costs are not any where near that.

That article shows $241 for pasture, $168 for hay, and a 90% calving rate... I'd find a new hobby with numbers like that. You dont stand a chance.

 

[cowrancher75]

probably around 50-60/ac depending.


I lease my neighbors 12 acres and give them half a beef a year. i pay processing. Thats worth .. what.. 1200? I'm paying pretty high but that little 12 acres keeps my cow herd all through winter since its hilly and all my land is flat. so its well worth it to me.

 

[Caustic Burno]

Drovers has profit at 67 bucks a year.
https://www.drovers.com/article/cattle-prices-and-profitability-2019

That's in Tennessee I assume? Our costs are not any where near that.

That article shows $241 for pasture, $168 for hay, and a 90% calving rate... I'd find a new hobby with numbers like that. You dont stand a chance.

Those are probably real close numbers.
My hay cost is 200 per cow.

 

[cowrancher75]

i feed for 7 months i don't even want to calculate my hay costs.\\

ok. i just did.. for my quality hay I can sell for 50/bale easily that would be around 350/cow in hay..


wow.

 

[Caustic Burno]

i feed for 7 months i don't even want to calculate my hay costs.\\

ok. i just did.. for my quality hay I can sell for 50/bale easily that would be around 350/cow in hay..


wow.

I figure it costs me right at 550 a year to run a cow. So with a 100% calving rate, you don't loose a cow everything perfect that's 250 profit per head.
That's in a perfect world that's not happening.

 

[1982vett]

i feed for 7 months i don't even want to calculate my hay costs.\\

ok. i just did.. for my quality hay I can sell for 50/bale easily that would be around 350/cow in hay..


wow.

So, you can make more selling hay rather than raising cattle?

 

[Dave]

Around here it is $20-30 a month per cow (pair) depending on the quality of the pasture. That is during the grazing season which is mid April to late October most years.