How do farmers make any money?

   / How do farmers make any money? #81  
Incentives for agribusiness in raising and not raising is part of the equation…

I remember years ago Docs were investing in Florida Orange Groves.

That said 70 acres of Christmas Trees going back 50 years comes up way short on incentives and assistance.

The only break works out to be about half off the sales tax for new farm equipment…

No property tax breaks, AG or forestry exemptions, subsidies, etc…
 
   / How do farmers make any money? #82  
There’s no shortage of people trashing farmers out there. And some are deserving of it.

But for every judgmental person who trashes farmers, I can tell you there’s unscrupulous doctors, lawyers, realtors, engineers, scientists, builders, corporate execs, pastors, rabbis, etc.

Only a very naive person would think farmers don’t take advantage of every program from the government that congress has passed.

The sad part about this is when you try to do the right thing and folks throw rocks at your way of life with ZERO understanding of the concept that it’s the few bad people who ruin it for the majority good people.

I’m in a unique situation and geographic area that allows me to farm with manageable risk. Still a lot of risk, but nothing compared to what I see elsewhere. I manage risk with off farm income, a good earning spouse, and resistance to “compete” with other farmers over who owns the newest equipment.

Equipment costs 10X what is cost 50 years ago, but incomes aren’t even close to 10X what they were 50 years ago. That is probably my single biggest reason for farmers in my size range struggling
 
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   / How do farmers make any money? #83  
Don't need to gamble, I farm'....

'You don't have to be crazy to farm, it does help though'....

Some frases I have heard from family members and other fellow farmers
 
   / How do farmers make any money? #84  
I think what that comes down to is that some people are just naturally wired to care for domestic animals and that others (myself included) are not. I know my grandfather always missed his horses, after he brought the first tractor on our farm in 1950. He also loved raising beef cattle, hogs, chickens, and geese.

No doubt that raising livestock involves lots of hard work, but if your wired for it and love it, is it really “work” ?

Some of it was ok with me, but much of it, like cleaning out manure and dealing with frozen water in the winter was not. Trying to beat the rain to get the hay in, stacking them bales in the scalding hot hayloft in the summer, and dealing with the mud in the fall harvesting corn also lacked any particular appeal. Making money is a separate, but related issue.

I see animals mainly as “food” and I firmly believe that the primary reason that the Good Lord populated the earth with them, is to feed mankind.

Near the end of grandpa’s time here on earth, it was getting very difficult to profitably produce beef, pork, and chicken. It took near perfect weather conditions. There were also many other “outside influences” like fuel, fertilizer, seed, equipment and land costs, that were beyond our control.

As those costs rose, most of the neighboring farmers gave it up, allowing their land to get overgrown and/or consumed by subdivisions and urban sprawl. That made a rich habitat for the local whitetail deer population.

For those farmers who “stuck it out”, it became even harder to grow crops for the livestock. The deer liked most of those crops. After grandad died of a heart attack, out behind the barn while grinding feed on one sad fall day, it didn’t take my dad and his brother long to decide to get rid of all the livestock.

My family had raised cattle on this farm since well before the Civil War, but none for the last 40 some years. Fortunately, I discovered that those whitetail deer taste as good or better than the Angus and Hereford cattle did, and we hadn’t got rid of all the old farm equipment.

They also take care of their own water in the winter, feed themselves, don’t need their manure cleaned up, never need a vet, and make meat that is healthier to eat.

There’s so many around here now, that the state allows us kill up to (9) deer per person (only (2) of which may have antlers) with reasonably priced resident hunting licenses, starting in mid September, and ending January 1, thru various seasons for guns, bows, crossbows and muzzle loading rifles.

It would be ludicrous for me to even consider raising cattle again. I dislike much of the work involved, I like the taste of venison better (as does my wife and kids), and I can often produce venison for less that $ 1 per pound, after subtracting all input costs.

Not even accounting for inflation, we hadn’t been able to produce beef for that cost since the 1960’s.

It almost seems too good to be true. I get to enjoy all the fun stuff of the farming, like turning the sod over in the spring and watching the corn pop up in rows, but none of the hard, expensive stuff.

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Some good friends of ours just slaughtered their last steer. They are done with it. Takes too much of their time, can't take a vacation, gotta make hay while the sun shines, etc... when they had kids and friends with kids, it was no problem to get a kid to watch the animals, help with the haying, or to sell the beef to families. Now that the kids have moved away, the families don't buy as much beef, and there aren't any kids to watch the animals. The adults are getting too old to help with the haying. Plus, they run the numbers, and it costs them more to produce it than they can buy it for at the same place they have the animals slaughtered and packages.

These are the same friends that introduced me to the dairy farm family I mentioned earlier.
 
   / How do farmers make any money? #85  
That's really interesting, but no real insight into the financials.
Pretty hard to get the financials of a private equity fund.

The point is, most of the small farms are absorbed by the big farms or sold off to land developers. The big farms are starting to band together.

I do not know a farmer that does not have an off-farm job as well, and usually their spouse works as well. The only exception I personally know is for that small dairy farm I mentioned, and it's pretty run down and the guy is pretty much a hermit.

We have friends that are involved with a family farm that plants 10,000 acres and finish 6000 hogs several times per year. The husband was also a fireman until he retired, and his wife works full time as well. All he does now is drive grain trucks at harvest time, sleeps at the grain dryer after harvest, and drives grain trucks to the best paying elevators when he's not doing the above. And he's tired of that. They always have newer equipment, trucks, cars, etc... the business pays for it all.
 
   / How do farmers make any money? #86  
As for subsidies... if it's legal, take it. You wouldn't skip deductions on your taxes would you?

35 years ago we got 2150 trees purchased, planted and side sprayed for $265 due to a government program do reduce soil erosion. It's nice forest now.
 
   / How do farmers make any money? #87  
There’s no shortage of people trashing farmers out there. And some are deserving of it.

But for every judgmental person who trashes farmers, I can tell you there’s unscrupulous doctors, lawyers, realtors, engineers, scientists, builders, corporate execs, pastors, rabbis, etc.

Only a very naive person would think farmers don’t take advantage of every program from the government that congress has passed.

The sad part about this is when you try to do the right thing and folks throw rocks at your way of life with ZERO understanding of the concept that it’s the few bad people who ruin it for the majority good people.

I’m in a unique situation and geographic area that allows me to farm with manageable risk. Still a lot of risk, but nothing compared to what I see elsewhere. I manage risk with off farm income, a good earning spouse, and resistance to “compete” with other farmers over who owns the newest equipment.

Equipment costs 10X what is cost 50 years ago, but incomes aren’t even close to 10X what they were 50 years ago. That is probably my single biggest reason for farmers in my size range struggling
Not just equipment, land costs are always going up as well. The big difference is land doesn't depreciate in value.
 
   / How do farmers make any money? #88  
Whew , being a simple worker with a 1040 and a 401k seems less stressful ,
though we all seem to be on the same wire wheel when it comes to uncle Sam . Question though if They clean up and out the IRS and make taxes simple and get rid off the thousands of different subsidies do you think that will help or hinder the non conglomerates out there ?
 
   / How do farmers make any money? #89  
Don't need to gamble, I farm'....

'You don't have to be crazy to farm, it does help though'....

Some frases I have heard from family members and other fellow farmers

“If you want to make a million in farming, start with 2 million”.
 
   / How do farmers make any money? #90  
I'm not a farmer, never have been, and never will be.
'Round here, there's a saying about row croppers. It goes like this: Why is the row croppers hat bill really narrow and curved? Because they always have their heads in the mailbox - looking for the check.

This joke/saying comes from Govt checks sent to row croppers to not plant parts of their farm. Please don't get me wrong, I believe in this program because we really don't want another great dust bowl or other disaster to cause a famine.

I DO believe however, that these checks should go primarily to the mom & pop farms rather than to the huge mega farms owned by corporations like you mentioned or huge farms completely leased by McDonalds, Monsanto, etc, etc. Just my opinion though.

Most of the farmers I know are smaller mom & pop types that farm cows, chickens, hay (for their animals feed), etc.(not large enough to be called ranchers, maybe 500 head and/or 3 chicken houses) They actually have small profit margins and probably average 12-15 hr work days 7 days a week. Lightning, hunters, etc sees them lose several cows a year that make it even worse.

I have real respect for all the farmers, row or critter, but it's a rough life that most wouldn't consider doing. Myself, I have a small garden, a few head, a few chickens, a horse or two and two tractors with various implements to make it all work. I'm also retired military so I have a monthly income to help out when things go upside down.
 

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