Demise of the Family Farm

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Re: Demise of the Family Farm

Post by Bigfoot » Sun Dec 01, 2019 6:39 pm

Richnm wrote:
Sun Dec 01, 2019 6:30 pm
Bigfoot wrote:
Sun Dec 01, 2019 5:14 pm
Richnm wrote:
Sun Dec 01, 2019 5:12 pm
Indians (at least I am, and I speak 100% my language not like some politicians) are doing just fine!
Image

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You know good and well what I meant. Government regulated us out.
Maybe I misread your statement
Perfectly understandable. I hope the Chiefs win.


Your not a small business owner. Your a stay at home mom trapped in a pyramid scheme.

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Re: Demise of the Family Farm

Post by Lucky » Mon Dec 02, 2019 1:57 am

Bigfoot wrote:
Sun Dec 01, 2019 4:54 pm
Lucky wrote:
Sun Dec 01, 2019 4:20 pm
What would everyone say the profit margin on a calf should be each year to stay profitable on a 100 hd herd? To make it easy lets say 0 death loss and we’ve been in this game long enough to be replacing culls with heifers we’ve raised. I use 100 hd because it takes about the same amount of time and equipment to deal with 100 as it does 30 hd, if there on the same place.
Edit: better add normal operating expenses too, we don’t need 3 cab tractors for 100 hd. Around here land leases for $25 an acre w/ 1 cow to 4 acres.
With $100 land cost, I'd say youd be making about $100 per cow. Cpu;dnt make that here, because land rents for more.
$100 profit per head?? Wow that’s low, I’d say around $300.

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Re: Demise of the Family Farm

Post by Jeanne - Simme Valley » Mon Dec 02, 2019 5:19 am

Calf has to pay for cows yearly expense (including calf's exp: meds/vacc/eartag/etc). Everything over that "should" be profit.
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Re: Demise of the Family Farm

Post by Stocker Steve » Mon Dec 02, 2019 8:49 am

[quote=HDRider I am trying to see how someone sells at a decent margin (gross margin) over operating expense. From what I can tell, operating expenses are linear, volume goes up, operating expense goes up almost the same.
[/quote]

1) An average cow calf operator makes a decent profit during only two years of the beef price cycle. So part of it is timing and determination for poor operators.

2) An above average cow calf operater does a little better in a number of expense and income areas. No silver bullet here. Some common threads are using some leased assets, a low cow replacement cost, and an above average weaning rate per exposed cow.

An interesting sitution here is called "too many cows". Some run more than they can manage, and/or more than their low cost forage can support, and these extra cows literally eat up the profit. So no - - operating income per cow is not linear.

Have you ever run numbers on what would happen if you culled the bottom 20% of your herd and stockpiled some forage?
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Re: Demise of the Family Farm

Post by Lucky » Mon Dec 02, 2019 2:56 pm

Calves need to avg $1,000 + at sale. The cattle business is a numbers game, the more you have the more you can make. 2 out of 10 yrs you might hit it right and make allot more money than usual but on avg cattle prices are flat. I always hear people talking about trying to save $20 a head on feed cost or $200 on replacement a cow. Rarely to you hear struggling operators talk about live weaning size calve percentages. To me the kick in the tail is when you have 100 cows and only 70-80% calf crop. It takes about an extra 30 seconds to feed 100 calves as it does to feed 75.

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Re: Demise of the Family Farm

Post by farmerjan » Mon Dec 02, 2019 9:13 pm

We are figuring about the $100 head average "profit" per calf. So a 100 cow herd, with 100 % calf crop will make you 10,000 per year. That's not much for all the work and time and inclement weather etc and so forth. . I agree that a calf needs to average more than the $6-700 head they bring here, with our cow carrying costs in the $550 to $650 per head per year. It is a whole different story in other areas; some are getting $.25 to .50 more per pound than we get here..... some have alot less in their cow costs because rental land is less, there are so many variables. But here one of our biggest hurdles is the price received for the calves due to the high trucking costs, plus many only run 20-40 head of cows so there is no good deals on a "pen of calves" that will make up a truckload. Several organizations popping up to co-mingle calves for sale.

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Re: Demise of the Family Farm

Post by Bigfoot » Mon Dec 02, 2019 9:23 pm

farmerjan wrote:
Mon Dec 02, 2019 9:13 pm
We are figuring about the $100 head average "profit" per calf. So a 100 cow herd, with 100 % calf crop will make you 10,000 per year. That's not much for all the work and time and inclement weather etc and so forth. . I agree that a calf needs to average more than the $6-700 head they bring here, with our cow carrying costs in the $550 to $650 per head per year. It is a whole different story in other areas; some are getting $.25 to .50 more per pound than we get here..... some have alot less in their cow costs because rental land is less, there are so many variables. But here one of our biggest hurdles is the price received for the calves due to the high trucking costs, plus many only run 20-40 head of cows so there is no good deals on a "pen of calves" that will make up a truckload. Several organizations popping up to co-mingle calves for sale.
My area must be about equal to yours, and you nailed it. You end up making somewhere between $0 and $2 per hour for your labor.
Your not a small business owner. Your a stay at home mom trapped in a pyramid scheme.

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Re: Demise of the Family Farm

Post by jltrent » Tue Dec 03, 2019 5:53 am

Bigfoot wrote:
Mon Dec 02, 2019 9:23 pm
farmerjan wrote:
Mon Dec 02, 2019 9:13 pm
We are figuring about the $100 head average "profit" per calf. So a 100 cow herd, with 100 % calf crop will make you 10,000 per year. That's not much for all the work and time and inclement weather etc and so forth. . I agree that a calf needs to average more than the $6-700 head they bring here, with our cow carrying costs in the $550 to $650 per head per year. It is a whole different story in other areas; some are getting $.25 to .50 more per pound than we get here..... some have alot less in their cow costs because rental land is less, there are so many variables. But here one of our biggest hurdles is the price received for the calves due to the high trucking costs, plus many only run 20-40 head of cows so there is no good deals on a "pen of calves" that will make up a truckload. Several organizations popping up to co-mingle calves for sale.
My area must be about equal to yours, and you nailed it. You end up making somewhere between $0 and $2 per hour for your labor.
Agree, it takes some luck, good weather and good management to be able to average that..

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Re: Demise of the Family Farm

Post by HDRider » Tue Dec 03, 2019 7:01 am

Stocker Steve wrote:
Mon Dec 02, 2019 8:49 am


1) An average cow calf operator makes a decent profit during only two years of the beef price cycle. So part of it is timing and determination for poor operators.

2) An above average cow calf operater does a little better in a number of expense and income areas. No silver bullet here. Some common threads are using some leased assets, a low cow replacement cost, and an above average weaning rate per exposed cow.

An interesting sitution here is called "too many cows". Some run more than they can manage, and/or more than their low cost forage can support, and these extra cows literally eat up the profit. So no - - operating income per cow is not linear.

Have you ever run numbers on what would happen if you culled the bottom 20% of your herd and stockpiled some forage?
Did you mean to say operating expense? I can see how operating income can be skewed if you grossly overextend your reasonable cost resources. It just never occurred to me that $90 per ton hay was an unreasonable cost item, but it is at the price calves are selling for now.

On you last point, I am pondering that right now.
bball wrote: "The juice wasn't worth the squeeze."
Dun said, "You gotta be flexible. Do whatever you have to do for the best results within your limitations."

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Re: Demise of the Family Farm

Post by HDRider » Tue Dec 03, 2019 7:06 am

Lucky wrote:
Mon Dec 02, 2019 2:56 pm
Calves need to avg $1,000 + at sale. The cattle business is a numbers game, the more you have the more you can make. 2 out of 10 yrs you might hit it right and make allot more money than usual but on avg cattle prices are flat. I always hear people talking about trying to save $20 a head on feed cost or $200 on replacement a cow. Rarely to you hear struggling operators talk about live weaning size calve percentages. To me the kick in the tail is when you have 100 cows and only 70-80% calf crop. It takes about an extra 30 seconds to feed 100 calves as it does to feed 75.
Agreed on the $1,000, assuming you have maybe $700 of cost in the calf.
bball wrote: "The juice wasn't worth the squeeze."
Dun said, "You gotta be flexible. Do whatever you have to do for the best results within your limitations."

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Re: Demise of the Family Farm

Post by bball » Tue Dec 03, 2019 3:30 pm

If one is being a responsible steward of their herd, then it primarily takes a good amount of reasonably priced land to turn a decent profit in cattle in this country. That's what I have gleaned from all these topics as of late. Whether that land is owned, leased, borrowed, inherited, allotted, etc becomes moot. The real factor is it has to be reasonably priced to have the volume and availability to generate a decent profit. There are no short cuts, quick fixes, or secret management style that overcomes this fact. It represents the single biggest expense involved with cattle; namely feed (in the form of pasture, hay). For many of the members who have posted on this topic, the land values have increased(input increase) and the finished product has remained steady or declined. A common factor for those that are still finding cattle suitably profitable appears to be they reside in areas of the country where large expanses of land are still accessible for a reasonable price.
It has been very informative to note the challenges and struggles that each region of the country faces. I am very grateful for everyone who decided to share on these recent threads because it helps bridge the gap on misunderstanding and assumptions.

As i drive around my region of the country, and see the old, broken remnants of fence that once stood proudly around the perimeter of miles worth of cornfields, I am reminded daily that the beef industry has truly left my region. As a boy, every fall after crops were out, the fields were dotted with cattle. Now, there is only 2 places in a 50 mile radius that puts cows out on the stubble. Both of us hobbyists with 30 head or so.
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Re: Demise of the Family Farm

Post by cowgal604 » Tue Dec 03, 2019 3:51 pm

bball wrote:
Tue Dec 03, 2019 3:30 pm
If one is being a responsible steward of their herd, then it primarily takes a good amount of reasonably priced land to turn a decent profit in cattle in this country. That's what I have gleaned from all these topics as of late. Whether that land is owned, leased, borrowed, inherited, allotted, etc becomes moot. The real factor is it has to be reasonably priced to have the volume and availability to generate a decent profit. There are no short cuts, quick fixes, or secret management style that overcomes this fact. It represents the single biggest expense involved with cattle; namely feed (in the form of pasture, hay). For many of the members who have posted on this topic, the land values have increased(input increase) and the finished product has remained steady or declined. A common factor for those that are still finding cattle suitably profitable appears to be they reside in areas of the country where large expanses of land are still accessible for a reasonable price.
It has been very informative to note the challenges and struggles that each region of the country faces. I am very grateful for everyone who decided to share on these recent threads because it helps bridge the gap on misunderstanding and assumptions.

As i drive around my region of the country, and see the old, broken remnants of fence that once stood proudly around the perimeter of miles worth of cornfields, I am reminded daily that the beef industry has truly left my region. As a boy, every fall after crops were out, the fields were dotted with cattle. Now, there is only 2 places in a 50 mile radius that puts cows out on the stubble. Both of us hobbyists with 30 head or so.
Wise words. We just spent a year searching for the right property. During that year I visited probably 100 farms in our area. About 90% of them were run down and broken down. So run down that you'd need millions to bring them back to life. Most of them are being sold due to people passing away and their families selling the assets or, just getting old and wanting to downsize. The only ranchers I knew in our area (we are about 20kms from a metropolitan city) moved far north to get land for cheaper and keep their cattle business alive. But we are even seeing those properties go up and you're right, with no change in the selling prices and in some cases a decline its impossible. 5 acres around here sells for $2M CDN or $1.5 USD. And that's with no real livable house. Unless you inherit it, there are no new young farmers coming into play. 20 acres which I think is a good size in these parts to try and start something profitable is selling for $5M+. We started our family farm on cattle, was our only business (as a hobby but enough to pay the bills), then quickly switched to chickens when we realized how little we could make on how expensive our land was.

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Re: Demise of the Family Farm

Post by Bright Raven » Tue Dec 03, 2019 4:02 pm

All good things must come to an end! And so it was with the American Cattle Producer.

Someday that will be a true statement, but not yet.
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Re: Demise of the Family Farm

Post by Bestoutwest » Tue Dec 03, 2019 6:16 pm

I have the chance to talk to a ton of folks from different walks of life all the time. I was talking to this one farmer and he was telling me about the first tractor he bought in 1975. It was $10K. They had to replace it and a new bottom level was $100K. How can you make a profit with that? Land costs are astronomical. There's a place I've had my eye on for years and it finally came up. About 9.8 acres. They want $270K for it. It's best suited for hay ground, but even so, how can you make that work?
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Re: Demise of the Family Farm

Post by Caustic Burno » Tue Dec 03, 2019 8:00 pm

Bestoutwest wrote:
Tue Dec 03, 2019 6:16 pm
I have the chance to talk to a ton of folks from different walks of life all the time. I was talking to this one farmer and he was telling me about the first tractor he bought in 1975. It was $10K. They had to replace it and a new bottom level was $100K. How can you make a profit with that? Land costs are astronomical. There's a place I've had my eye on for years and it finally came up. About 9.8 acres. They want $270K for it. It's best suited for hay ground, but even so, how can you make that work?
It’s all the same in 1975 most people were making 2.50 an hour land was 400 dollars an acre. I couldn’t believe the 250 acres across the road was a 100k.
I was making 3.90 and couldn’t see anyway possible to afford it. That’s 8k a year. I don’t know what the average AGI is, I bet the average family AGI filing today is 100k.
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