Will cattle pay for the land

[firestormboergoats]

Here goes, I have found some land for 6 to 9 thousand per animal unit. Can I break even w/ cattle on land that is that high? I have another job, and I am going to mix species graze it so the cattle only have to pay for half of the mortgage but can they? My math says yes, but I would like some input from someone who actually has had cattle. I would be talking about 80-90 head of cattle on improved coastal and klien (sp?). Thanks in advance for any answers.

 

[jt]

a plain old cow/calf operation imo.. no.

if you are established in a higher dollar market.. like registered stuff... i suppose its possible, but it would take many years.

my advice to you would be to find some land to rent until i knew how well things will go. then you will have the answer to your question.

jmo.. good luck,


jt

 

[Dap]

I agree with jt. Try to rent a place first, then you'll know what you can afford to buy.

Is there anywhere left that you could pay for a farm with a cattle operation? I mean paying the mortgage and having enough left over to live, not counting an off the farm income?

 

[baggs]

I
Is there anywhere left that you could pay for a farm with a cattle operation? I mean paying the mortgage and having enough left over to live, not counting an off the farm income?

The 80 acres (raw land, well water) next to me is for sale, $22,000 an acre!! If I could sell my beef at $25 a pound I could make it work….

 

[shorty]

No

 

[Jake]

no you can't, what's your stocking rate there?

 

[MikeC]

The general consensus with most bankers here is that you couldn't make a living off cattle if starting from scratch if someone "GAVE" you the land.

If you think about it..........they are probably right.

 

[Brandonm2]

There is absolutely no way. IF you averaged weaning 500 pounds of calf per cow exposed (good production) and IF the market stayed up like it is now (and it won't) you would gross $600 per cow exposed (500lbs*$1.2/lb). IF your per cow costs were $250 then your after cost returns would be $350 per cow or per animal unit. IF you paid $6000 for the animal unit, interest ALONE on that A.U. would be $360 (@6%) a year, which would eat up all your income and leave nothing towards paying off the note and in most of the last 15 years those calves wouldn't even cover the interest. NOW if you had the off farm income to just invest in the land and you have reason to believe that that $6000 land is going to be $15,000-25,000 land within 10 years, I don't see any reason NOT to invest in the land and invest some cash in a few cows while you are waiting for the town to grow your way. Selling your farm can be heartbreaking; but if you accept that that is your goal going in there ""COULD"" be a big payday in your future...just don't expect it off of the cows. Hunters are buying up land all over this state. They see the land as an investment itself and don't even pretend that anything they do with it is paying that bill. Farmers on the other hand want $400-700 calves or $1.7-/bushel corn to pay for the land and as a result get outbidded on most properties. IF you have the kind of job that you can speculate in land, this COULD be an opportunity; but if you need cows to pay for the property, that is mission impossible for just about any set of cows.

 

[Running Arrow Bill]

As a "universal" rule, livestock won't pay for land plus support themselves. Even if you have free land, it is difficult for the stock to even pay for their own (quality) keep. With registered cattle...maybe yes...if you can sell calves & yearlings for very good prices...

Day jobs are always subject to downsizing, termination, etc. Consider you day job to be there "today"...tomorrow...wait and see what tomorrow brings...

Yes...outside funds are usually needed to support a quality livestock operation. Look at the "big guys" and the "successful" newcomers...they usually have a pot of gold somewhere to subsidize their livestock operation.

 

[Stocker Steve]

a plain old cow/calf operation imo.. no.

if you are established in a higher dollar market.. like registered stuff... i suppose its possible, but it would take many years.

my advice to you would be to find some land to rent until i knew how well things will go. then you will have the answer to your question.

jmo.. good luck,

Stock can pay for land if you know how to graze... but there are three major issues with way most try to cash flow real estate:

1) not willing to move to where the better grazing land values are
2) not positioned with enough equity to buy into an economically sized operation
3) not willing to manage higher value (of gain) stock rather than just running black beef cows like the neighbors

Renting land is good short term advise. Marrying into money is even better!

 

[Brandonm2]

IF land is that high already in that area, I wouldn't buy expensive cows and equipment just to rent somebody else's land. It won't be many years before that property develops. I lost every lease I had here. The dozers crank up at 6:30 am and don't all stop until 6:30 pm every dry day. A property owner may love riding his horse through the fields, barbecuing by his private pond, hunting, working on cars in his barn, etc but when the developers offer $15-32g an acre, the cows have got to go.

 

[C HOLLAND]

Well my 2.5 cents worth I purchased (5 years ago) 100 acres @ $1,000 per acre and after next month have cut $65,000 in timber and I am investing most of that back into the land for fencing, barns, ponds and cattle. I work a full time job as a Purchasing Manager and I dont depend on the cows for my source of family income. I do think I can make 10-15,000 per year in 3 years from now. I plan on doing rotational grazing on 60 acres and raise 50 replacemennt heifers per year. I am starting with PB Angus stock and doing AI on all in the beginning, and I am not buying all new equipment. You can go off the DEEP END and spend your profits for 10 years ahead if you are not careful.

just my opinion, I don't see how anyone could start with land that high and make a profit.

 

[bojack]

I like C HOLLAND's idea. I have thought about this myself. I plan on doing the exact same thing when I get started.

 

[C HOLLAND]

Hey Brandonm, what part of Bama are you in, I am in LA (lower alabama)

And bojack, thanks also I will be at Southern Cattle Company in Marianna Fla next week for an AI school put on by Select Sires.

 

[RichieMaGoo]

IMHO, the only way one has a shot at making cows pay for the land and supply a frugal living, is if one buys land in one of the very few areas where you still get good pasture for $1,000.00 an acre, and if you know the local market, so that you know what will produce a decent profit at minimal expense.

I paid $30K for 27.5 acres. With 20% down, my mortgage is only $250 a month- and I can make that selling one bottle-raised steer per month. I'm purchasing 30 more acres contiguos with my farm for about the same price- so then, 2 steers per month will pay the whole mortgage.

Add four more steers per month, and I can buy groceries and pay all of my other bills. Add to this some other small endeavors around the farm, and you can see that a modest living is possible. Keep a steer to butcher every year, and some chickens, and maybe shoot a deer and grow some veggies....and you'll be eating better and substantially reducing your grocery bills!

And hopefully, the land will be appreciating in value all the while.

If you can get into the farm-direct to the consumer marketing, or any of the specialty markets, things will look even better.

Of course, if you "have to have" a $40K dually pick-up and all the toys....it'll never work. Neither will it work where land costs thousands per acre.

The main factors are the cost of the land, and what you're looking to get out of it.

I barely make a third of what I did in the city.....but my quality of life is 100 times better!

 

[firestormboergoats]

Guess that pretty much sums it up. Thanks for the answers and opine's. I can't afford to pay for it, but I have enough time off to work it so I was hoping that the livestock would pay for it and when I retire in 20 years from my day job, I would have a couple hundred acres paid for to "play" with. Land around here is high, but that land had the lowest cost per animal unit I have found. Thanks again for the answers and I will keep my eyes open for some land to lease!!!

 

[bojack]

C HOLLAND check your PM.