What to do with land if the cattle industry collapsed?

[HDRider]

How much is it now?

Out of curiosity I googled lands in Oklahoma. Found several places. If this link works you should look at this. Cows could pay for a place like this.

https://www.landsofamerica.com/property/424-acres-in-Nowata-County-Oklahoma/7388824/

That piece was $854 per acre.

 

[hurleyjd]

How much is it now?

Out of curiosity I googled lands in Oklahoma. Found several places. If this link works you should look at this. Cows could pay for a place like this.

https://www.landsofamerica.com/property/424-acres-in-Nowata-County-Oklahoma/7388824/

Nearly all land advertised in Nowata county Oklahoma will be $2200 per acre and up. The place you listed states 424 acres but the description of the land below the advertisement shows 145 acres which would be $2200 per acre. Something not right here.

 

[Caustic Burno]

How much is it now?

Out of curiosity I googled lands in Oklahoma. Found several places. If this link works you should look at this. Cows could pay for a place like this.

https://www.landsofamerica.com/property/424-acres-in-Nowata-County-Oklahoma/7388824/

That piece was $854 per acre.

Can you raise an umbrella sitting on a sack of fertilizer.
Land here was 800 an acre thirty years ago.

 

[backhoeboogie]

Can you raise an umbrella sitting on a sack of fertilizer.
Land here was 800 an acre thirty years ago.

Google OK land CB

Mike bought land in Fort Townson not ten years ago for $800 an acre. He spent several weekends enforcing fencing then moved his cows up there. Moving those cows took him a month.

You can get loans now for 4 percent and under fairly easy. Locked in. If you have a good group of 4 to 8 year old cows and could live with going to a calving season, the cows could pay for that land.

Living 4 hours away is not attractive for me.

 

[backhoeboogie]

How much is it now?

Out of curiosity I googled lands in Oklahoma. Found several places. If this link works you should look at this. Cows could pay for a place like this.

https://www.landsofamerica.com/property/424-acres-in-Nowata-County-Oklahoma/7388824/

Nearly all land advertised in Nowata county Oklahoma will be $2200 per acre and up. The place you listed states 424 acres but the description of the land below the advertisement shows 145 acres which would be $2200 per acre. Something not right here.

There were 958 listings on the site I went to. I just picked one. A lot of the listings were tumble weed looking places that offered little grazing. I found ONE that looked reasonable, copied the link, just for an example. I did not look at more than a dozen of the 958 listings.

But, at $2200, and with interest rates below 4%, the cows could pay for that land if it offers good grazing.

 

[HDRider]

Out of curiosity I googled lands in Oklahoma. Found several places. If this link works you should look at this. Cows could pay for a place like this.

https://www.landsofamerica.com/property/424-acres-in-Nowata-County-Oklahoma/7388824/

Nearly all land advertised in Nowata county Oklahoma will be $2200 per acre and up. The place you listed states 424 acres but the description of the land below the advertisement shows 145 acres which would be $2200 per acre. Something not right here.

There were 958 listings on the site I went to. I just picked one. A lot of the listings were tumble weed looking places that offered little grazing. I found ONE that looked reasonable, copied the link, just for an example. I did not look at more than a dozen of the 958 listings.

But, at $2200, and with interest rates below 4%, the cows could pay for that land if it offers good grazing.

You say the cow could pay for the land, but it could not pay for the land, operating expense and capital costs.

 

[backhoeboogie]

Nearly all land advertised in Nowata county Oklahoma will be $2200 per acre and up. The place you listed states 424 acres but the description of the land below the advertisement shows 145 acres which would be $2200 per acre. Something not right here.

There were 958 listings on the site I went to. I just picked one. A lot of the listings were tumble weed looking places that offered little grazing. I found ONE that looked reasonable, copied the link, just for an example. I did not look at more than a dozen of the 958 listings.

But, at $2200, and with interest rates below 4%, the cows could pay for that land if it offers good grazing.

You say the cow could pay for the land, but it could not pay for the land, operating expense and capital costs.

HD I agree. My statement is the cows can pay for the land and I believe that.

On the place I had, I was putting in 20 to 30 hours a week and earning $1300 a month (average) over a 6 year span. I could not live on $1300 a month.

The cows were paying for the land and I was building equity. Using a '76 MF tractor and worn out everything. The cows had to buy a few tires and a whole lot of hydraulic fluid, along with the diesel to run the tractor. One of the years was in the red because of drought but hay sales brought it back into the black. It doesn't pencil out that way on taxes since the hay was not sold the same year it was put up.

When I sold that place I made a buttload of money in capital gains.

As you know HDR, there are no free rides. But if you can get your cows paying for land, and you are building equity, its going to pay off in the long haul. Or you can be a naysayer, throw your hands up, and sit at home watching I Love Lucy. I kept my day job. Always have.

 

[Dave]

The amount of pessimism on this board never fails to amaze me. I am surrounded by people who make there living raising cattle and they never express the type of attitude that I see here.

Walk the talk Dave...

I think I already did that. I sold my place in Washington and gave up the leases two years ago. I bought a place here that is six times bigger than my total deeded and leased acreage in Washington. If you count the BLM allotments this place is 81 times bigger. The only way to be successful is to not be afraid of the occasional loss along the way. The people I see who make it in the cattle business are in it for the long haul. The occasional bad spots are just learning lessons. If I were 40 years younger I would be jumping in a whole lot more than I am now.
I helped haul 186 calves yesterday. They were weaning calves off replacement heifers and some cows who are new to this part of the world. They weaned early to give these cows a little break and fall pasture time to recover and grow a bit. Three owners on these calves. One is 50 yo and started with nothing. He runs 900 pairs. The other two are 21 and 29. The two young guys had more calves that the older guy. 50 years ago people were saying that it is impossible to make it with cattle. But people who were willing to work somehow started with nothing and made it work. It is happening now and will continue to happen.

 

[Brute 23]

Hate to break it to the author but cattle havnt been able to pay for land in the last 25 years... we are already there. Land prices sky rocketed when the market quit valuing land off what it could produce in revenue.

People were still buying land in south east Oklahoma for $800 an acre not even ten years ago.

How many acres does it take to raise a pair there?

You can buy land like that in WTX but it takes 75ac to raise a pair.

 

[backhoeboogie]

Hate to break it to the author but cattle havnt been able to pay for land in the last 25 years... we are already there. Land prices sky rocketed when the market quit valuing land off what it could produce in revenue.

People were still buying land in south east Oklahoma for $800 an acre not even ten years ago.

How many acres does it take to raise a pair there?

You can buy land like that in WTX but it takes 75ac to raise a pair.

South East Oklahoma is noting like WTX

 

[bball]

The amount of pessimism on this board never fails to amaze me. I am surrounded by people who make there living raising cattle and they never express the type of attitude that I see here.

I am by nature a very optimistic person, driven by the realities I see.

I can only speak to my situation. It I know well.

It cost me more to carry a cow than I get from selling a calf. I am not spending money wastefully, or wantonly. I do not factor in my capital cost when I say that. I am speaking strictly about operating cost, mostly hay, which cost me about $35 per ~750# bale.

More cows cost more, less cows cost less. It is a linear equation for me.

Maybe I am doing it wrong. Maybe I am just too stupid to figure it out.

Very honest and genuine post HDRider. I suspect many of us small timers are in a similar canoe as prices drop but costs continue to slowly climb. I firmly believe there are very few locations left in this country where a cattleman can make it without inheriting cheap land purchased generations earlier or running them on govt land. I know it doesn't work here. Not with ground costing 8-10k per acre. Only 2 people I know making it go are either 4th generation(cheap land) or sunk an entire retirement(Very deep pockets and poor ROI). Both are registered, not commercial.
But as a good friend recently told me when we were having this very discussion, "what else am I going to do if I don't do this?"

 

[Brute 23]

People were still buying land in south east Oklahoma for $800 an acre not even ten years ago.

How many acres does it take to raise a pair there?

You can buy land like that in WTX but it takes 75ac to raise a pair.

South East Oklahoma is noting like WTX

I understand that but it's nothing like the gulf coast either or it wouldn't be $800. Just making the point that just because it's cheap doesnt mean it makes money.

The last land my family purchased was like $1200/ ac in the 90s. It's a pair to 3-5ac country. It was manageable at the time because there was paid for land and cattle and equipment to help tote the note. A person might have made a good run at letting only the cattle on that place pay for the land at that price, but you wouldnt have paid any outside bills or taken any thing home for a good while. Plus you would have had to go thru two pretty bad 4 year droughts not too long out the gate. I'm talking real droughts and $.80/lb markets... not these little dips every one is crying about now days.

 

[bball]

There were 958 listings on the site I went to. I just picked one. A lot of the listings were tumble weed looking places that offered little grazing. I found ONE that looked reasonable, copied the link, just for an example. I did not look at more than a dozen of the 958 listings.

But, at $2200, and with interest rates below 4%, the cows could pay for that land if it offers good grazing.

You say the cow could pay for the land, but it could not pay for the land, operating expense and capital costs.

HD I agree. My statement is the cows can pay for the land and I believe that.

On the place I had, I was putting in 20 to 30 hours a week and earning $1300 a month (average) over a 6 year span. I could not live on $1300 a month.

The cows were paying for the land and I was building equity. Using a '76 MF tractor and worn out everything. The cows had to buy a few tires and a whole lot of hydraulic fluid, along with the diesel to run the tractor. One of the years was in the red because of drought but hay sales brought it back into the black. It doesn't pencil out that way on taxes since the hay was not sold the same year it was put up.

When I sold that place I made a buttload of money in capital gains.

As you know HDR, there are no free rides. But if you can get your cows paying for land, and you are building equity, its going to pay off in the long haul. Or you can be a naysayer, throw your hands up, and sit at home watching I Love Lucy. I kept my day job. Always have.

Another factual post! Perhaps the cows can cover the land, but they will not cover everything and provide an actual living. I always enjoy your post BHB on this topic because I think you look at it realistically; namely, the money is in the property, not the cattle. Sweat equity goes a long way also, but is recouped in the land, rarely the cattle. The cattle are a tool to support the land. I think the real concern becomes "what happens when or if there is a correction on land values?"

 

[HDRider]

You say the cow could pay for the land, but it could not pay for the land, operating expense and capital costs.

HD I agree. My statement is the cows can pay for the land and I believe that.

On the place I had, I was putting in 20 to 30 hours a week and earning $1300 a month (average) over a 6 year span. I could not live on $1300 a month.

The cows were paying for the land and I was building equity. Using a '76 MF tractor and worn out everything. The cows had to buy a few tires and a whole lot of hydraulic fluid, along with the diesel to run the tractor. One of the years was in the red because of drought but hay sales brought it back into the black. It doesn't pencil out that way on taxes since the hay was not sold the same year it was put up.

When I sold that place I made a buttload of money in capital gains.

As you know HDR, there are no free rides. But if you can get your cows paying for land, and you are building equity, its going to pay off in the long haul. Or you can be a naysayer, throw your hands up, and sit at home watching I Love Lucy. I kept my day job. Always have.

Another factual post! Perhaps the cows can cover the land, but they will not cover everything and provide an actual living. I always enjoy your post BHB on this topic because I think you look at it realistically; namely, the money is in the property, not the cattle. Sweat equity goes a long way also, but is recouped in the land, rarely the cattle. The cattle are a tool to support the land. I think the real concern becomes "what happens when or if there is a correction on land values?"

I might be wrong, but I think land value might be the one thing that does not go bust.

The dollar will be worth less and less over time. That in itself will make the dollar price tag higher.

Not real sure what would happen if we start transacting in yuans

 

[Lucky]

Buying land is a long term personal investment and I don't think you can go wrong doing it.
Cows are a different story though, they are more of a midrange investment (5-10 years) that can make money if managed correctly. There is no way in the current market that cows will pay their own way and buy land, they will pay the $25-30 an acre lease payment though. Cows are a numbers game. If you can profit $100 per calf and have a thousand of them that's a good living. The same profit with 50 cows isn't so good. If you are honestly loosing money on every calf every year it's probably time to try something different. It could be mismanagement or the cost of land and feed in your area. I know I've said it a thousand times and everyone is tired of hearing it but there's no money in selling a 450-500 pound calf of the tit anymore.

The article that started this thread was obviously written by someone that's never had muddy boots and probably has hands that feel like a babies butt.

 

[Bill21342]

That's the tru to life story. We should survive as we can. Big predators eat small prey.

 

[backhoeboogie]

The last land my family purchased was like $1200/ ac in the 90s.

I didn't know we were talking family.

My eldest daughter has 4 ranches and is working a 5th. She is no longer working as an engineer. (Degree TB). I'm really glad she's not following some of the advice here.

If you're losing money, someone else is earning it. They don't throw your money in a barrel and burn it.

The point is you can still buy good land and turn profit on it. People are doing it. Maybe you are not doing it. But other people are.

I do know what my daughter paid for that ranch is Desdemona, TX. She stole it. The entire place is grazing land. 1920's Craftsman home and a huge modern steel barn. 6 deep water wells. I suspect she turned profit on it the first year. That purchase happened in 2015. It is nothing like you are describing.

Interest rates are really good. I just bought 3 more rental houses. These are not for me to live off of right now. I want to pay them off within 6 years. All profit will go against debt or improvements. They will be managed by a management agency. I've already received an offer (thru the lady managing them) but I'm not planning on flipping them. But I could.

There is money in real estate. A lot of money. Farms. Houses. It's there. People are earning money. I've earned a whole lot. Everything I have ever purchased has sold for at least 50% more than I paid.
500% on one 8 acre piece.

I refuse to borrow money for toys or pick ups, boats, atvs etc. If I can pencil out loans for real estate transactions, I pull the trigger. I have 2.7 million net worth real estate that's debt free at the moment. I have other property that I am in debt for. 6 counties here in Texas.

Oklahoma is tempting me but it's too much travel at this age.

 

[Brute 23]

Thanks for all the fun facts but nothing you are saying has any thing to do with my original comment. It appears you just want to give every one your resume. Good day :tiphat:

 

[alisonb]

The amount of pessimism on this board never fails to amaze me. I am surrounded by people who make there living raising cattle and they never express the type of attitude that I see here.

Walk the talk Dave...

I think I already did that. I sold my place in Washington and gave up the leases two years ago. I bought a place here that is six times bigger than my total deeded and leased acreage in Washington. If you count the BLM allotments this place is 81 times bigger. The only way to be successful is to not be afraid of the occasional loss along the way. The people I see who make it in the cattle business are in it for the long haul. The occasional bad spots are just learning lessons. If I were 40 years younger I would be jumping in a whole lot more than I am now.
I helped haul 186 calves yesterday. They were weaning calves off replacement heifers and some cows who are new to this part of the world. They weaned early to give these cows a little break and fall pasture time to recover and grow a bit. Three owners on these calves. One is 50 yo and started with nothing. He runs 900 pairs. The other two are 21 and 29. The two young guys had more calves that the older guy. 50 years ago people were saying that it is impossible to make it with cattle. But people who were willing to work somehow started with nothing and made it work. It is happening now and will continue to happen.

I wasn't referring to your accomplishments Dave but more specifically the words 'pessimism' & 'attitude' you used ;-).

 

[backhoeboogie]

"what happens when or if there is a correction on land values?"

I hope to get in when it bottoms out. Buy buy buy.