sizing tractors/implements

[cowboydoc]

Jim,

You need to be alot more specific if you want to know if something is going to be profitable. I don't see how you can be profitable buying hay equipment on a 100 acres. Not when you consider your time, unless you like to work for free. Each situation is going to be different. What kind of ground do you have? What is the weather in your area? Are you going to raise grass or alfalfa? What are going to be your input costs? What's the condition of the ground? Has it been hayed before and what was the yield? How much did you pay for the ground? What's the interest? etc. etc. This and a hundred other questions go into the equation. There is just about zero chance of making a 100 acres pay when you consider the cost of the land and the cost of the equipment.

 

[slowzuki]

I think lbs per acre is quite different in different areas. In NB very few farms work more than 100 acres of hay.
Ken

 

[cowboydoc]

Ken,

I completely agree with you that it's different in different areas. Even the best farmground in the country can only grow so much hay though. If you seriously put a pencil to it and had to buy the land, buy the equipment, and pay yourself anything at all for your time it would be pretty tough to show much of a profit even on the best farmground in the country. Very few people make much, if any, kind of a living off of 100 acres, not doing hay or row crops anyway. There are some specialty farming that requires little or no equipment that people make a go of it at, but haying and row crop farming isn't one of them.

 

[HayDR]

cowboydoc,
The calf crop will yield about $20,000, say $5,000 of profit from tobacco. Now the farmer must spend the profit or the IRS will get 50% of it so they will have to purchase something to offset the profits. The tax system needs to be changed so they could save the money.

 

[cowboydoc]

$20,000 from how many calves? You can't run 50 head of cows on 20-40 acres or make enough to feed 50 cow/calf pairs. And then that isn't all profit either. Right now the figure for this year is going to be .88/pound to break even. Of that $20k sales probably only 10-20%, if that, is profit.

I understand what you're saying but nobody is doing it for profit or a living. They all have regular jobs that the farming/ranching is a good tax write-off. It's just something they enjoy doing and nothing wrong with that. Much rather see people buyign tractors and balers than boats. /forums/images/graemlins/wink.gif

 

[HayDR]

At current prices and Angus cross steer or bull 600 Lbs will gross over $500 each. Cows need 3-4 ton of hay per winter and calves need 1 ton. By no-till drilling a grazer Rye in October you can stockpile some extra grass for winter months. We typically run one cow to .80 cow per acre depending on the amount of trees. If a farmer has 100 acres he can run 50-80 head of brood cows. The key is live on a budget, lime your ground 3 ton per acre every 10 years, use 12-24-24 fertilizer on your pastures at 400 Lbs per acre. Spend all the profits you do not need on facility improvements, the IRS will waste if if you send it to them.
One more thing purchase a good tractor, Mine is a JD, take care of it and keep it 10-15 years.

 

[cowboydoc]

All great advice and I agree 100% Mark. A 100 acres I agree you can run 50 head on and probably gross $20k. But not 20-40 acres. I don't about you but I sure wouldn't want to try and raise a family of four on $20 or 25k a year. And after inputs, cattle costs, replacement heifers and bulls, cattle losses, medicine, vet bills, equipment, etc. you'll be lucky to see any profit. I mean even if you figure buying old equipment you're going to have $30k in equipment. 50 cows and 4 or 5 bulls are going to run you $50,000 or more. A 100 acres is at least going to run $150,000-$200,000 and that's pretty cheap land. So you've got $250,000 - $300,000 just to start out. And off of that you're going to gross $20-25k. Net maybe half of that on a really good year. On a bad year you're going to lose that much. And if you've got any of that money borrowed well there's goes all of your profit to the banker. /forums/images/graemlins/frown.gif Nope no matter how a person slices it it's pretty tough to ever make much at it. Do that for 30 years and be broke or put that same money in a low-risk retirement fund and retire a millionaire. /forums/images/graemlins/confused.gif But it is a great way to live. /forums/images/graemlins/grin.gif

 

[HayDR]

Richard,
Much of this land was in the family and passed on to the next generation. You are forgetting that these farmers usually have 1-2 incomes off the farm. Most of these folks live on a household income of less than $100,000 a year. The key is living debt free and on a budget. I know your malpractice insurance is unreal so is my workers comp. ins., liability ins. not to mention full coverage health insurance for our employees . It doesn't matter how much you make it's how much you spend. Farmers are a resourceful bunch of people.

 

[slowzuki]

I know what cowboydoc is trying to say, to buy land and begin the business of farming you need a lot of land. In NB farm land sells for 750 -1000$ per acre. Even at that price you don't make money buying a farm.

Most farms are at least family owned ie the land is long since paid off and most equipment is paid off. Even if the family doesn't work it themselves it can turn a profit. Many of my friends grew up on farms with low income.

Remember the farm/family truck expenses reduce the apparent income but leaves them with transportation. Also they typically have all the meat they can eat at low cost.

I won't discuss lifestyles as it is not appropriate here.

Commercial animal farms here in the maritimes are 250 acres or less, most being under 100 acres. Potatoe farmers generally work farms in the area of 500 acres. Some mega farms exist on PEI where the law limits the amount of land you can own to 500 or 1000 acres? (Can't rememeber) so they lease at least as much as they own.

Typical hay operations are under 100 acres, it is simply all woods here, it would cost a fortune to put big fields in.

Someone with 100 acres would hay in the summer and log in the winter. I don't know the climate where you are but I visited the praries this summer and our climates are completely different. The grass was thin and they would have 30 cattle on 30 acres of land.

Here in the summer you can leave 30 cattle on 10 acres and barely keep ahead of the grass. My neighbour had 2 draft horses and 2 riding horses on 5 acres and had to bushhog several times. This is all on land that has been unmanaged for at least 10 years.

I think the moisture is the key factor but we also have very long days in the summer, sun up at 5am or so and goes down at 10pm.
Ken

 

[cowboydoc]

"You are forgetting that these farmers usually have 1-2 incomes off the farm."

Actually I mentioned that in a post above. Heck you can't make it just farming anymore. Haven't been for a long time. The banker when I went in to talk to him last told me that to even consider a loan for someone anymore that is just farming they insist that the person has 2500 acres to farm to even realistically be able to keep their head above water.