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Old 11-04-2019, 08:17 PM   #1
miket
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Default Why do people have cattle if its so unprofitable?

I have done a bit of reading about the profitability of raising cattle and the consensus seems to be that there is no money in it. Read somewhere that the typical cow/calf operstion loses 4% a year. Other numbers I have read are average of $26 profit per cow. So my question is, why do so many still do it? So many people have 20-100+ acres and put cattle on it. Assuming they make the supposed $26 cow, we are looking at maybe $500/yr profit? Can hardly imagine it being worth it. I get the whole ag exempt thing, but that cant be all of it, especially now thet we can get the wildlife exemption.

If your land is payed off/free, is it even worth the trouble to put them on 100-150ac?
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Old 11-04-2019, 08:18 PM   #2
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Tax break


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Old 11-04-2019, 08:20 PM   #3
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Ag exemptions. Had 5 steers on 90 acres from April to end of August this year and they made $1,300. It was a good wet, Green year.


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Old 11-04-2019, 08:23 PM   #4
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IMO they make closer to $400-500 per calf when sold in net profit. Still not enough for me.. But the cattle guy I know runs cows on 10+ properties and the smallest property has 25 cows on it.. So 250-300 times $400 each adds up
He may make less IDK I was just guessing. He swears he doesn't make much and does it because it's the only thing he's ever done since the 1940's and he'd much rather spend time with his cows than people LOL
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Old 11-04-2019, 08:24 PM   #5
doghouse
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Ag exemption. Can you imagine the fall in land prices if the government took all the exemptions off of it. You can have 2 million in a CD and no tax. Two million in land you get property taxes. What is the difference? Just curious.
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Old 11-04-2019, 08:25 PM   #6
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Tax benefits
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Old 11-04-2019, 08:26 PM   #7
doghouse
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IMO they make closer to $400-500 per calf when sold in net profit. Still not enough for me.. But the cattle guy I know runs cows on 10+ properties and the smallest property has 25 cows on it.. So 250-300 times $400 each adds up
He may make less IDK I was just guessing. He swears he doesn't make much and does it because it's the only thing he's ever done since the 1940's and he'd much rather spend time with his cows than people LOL
I can guarantee no cattle rancher is making that much per calf. Meat packers are but not the bottom man, the producer.
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Old 11-04-2019, 08:26 PM   #8
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I'd like to know one thing. Why don't the sale barns have to 1099 the people who sell cattle?
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Old 11-04-2019, 08:30 PM   #9
RiverRat1
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Originally Posted by doghouse View Post
I can guarantee no cattle rancher is making that much per calf. Meat packers are but not the bottom man, the producer.
So how much they make then? The guy in post 3 made $250 each.
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Old 11-04-2019, 08:33 PM   #10
doghouse
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I can't imagine all the paper work for every sale at any market. Cattle, sheep, goats, exoctics, etc. Ranchers do get audited from time to time.
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Old 11-04-2019, 08:41 PM   #11
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Default Slippery slope

Most of the places I have worked on, don’t make money off cattle, they use them to hide/ off set the , money they make off minerals , pipelines, and high hunting lease fees, cattle ranches can only survive on their side hustles
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Old 11-04-2019, 08:43 PM   #12
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Numbers game. More cattle-more money you make.
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Old 11-04-2019, 08:44 PM   #13
M16
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So how much they make then? The guy in post 3 made $250 each.
It depends on how the operation is run. I do fairly well with mine since I don't lease any land. I run a lot fewer head per acre than everybody around. But I don't spend a bunch of money on hay and vet bills. They either make it or they don't. I go by what an old successful cattleman told me. Those cows need to make me a living, they're not here for me to make them a living.
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Old 11-04-2019, 08:45 PM   #14
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So how much they make then? The guy in post 3 made $250 each.
I am not sure how he figured his profits, but maybe he can chime in. Guessing he simply figured the initial costs taken from his selling price.

Other things to consider, land costs , electric costs (water well??) hauling, fencing depreciation, land tax. Capital costs ( money tied up in the cattle vs. earning a profit in other investments ), Not to mention the risk if one or more had died. Finally labor.
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Old 11-04-2019, 08:48 PM   #15
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We have a local cattle rancher. He is buying up land at $25,000 per acre and then clearing the land, having ponds built, installing irrigation for his grass(huge turret guns) and fencing it.

He will never make a dime on cows in this lifetime but chicken has made him a billionaire. If I was him I would be building chicken houses not cattle ranches.
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Old 11-04-2019, 08:50 PM   #16
Boss Buck
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All cattleman lie a bit... Or there would not be so many.
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Old 11-04-2019, 08:52 PM   #17
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My brother runs a bunch of cows, never can understand why. Definitely doesn't make enough off them for work involved and the hay he goes through. Its his hay but still cost money to grow and roll it.
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Old 11-04-2019, 08:53 PM   #18
texan16
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We have a local cattle rancher. He is buying up land at $25,000 per acre and then clearing the land, having ponds built, installing irrigation for his grass(huge turret guns) and fencing it.

He will never make a dime on cows in this lifetime but chicken has made him a billionaire. If I was him I would be building chicken houses not cattle ranches.
$25,000 an acre ????? he wont be a billionaire for long.
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Old 11-04-2019, 08:56 PM   #19
ttaxidermy
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It's seems to be some sort of "cowboy" status symbol in these parts.. I know guys that have 4 or 5. Just enough to be a PITA.. Lol
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Old 11-04-2019, 08:57 PM   #20
JANKEII
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I have a couple of cows on my place for tax purpose.
Better than having the government controlling my property over wildlife exemption
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Old 11-04-2019, 09:01 PM   #21
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people, including cattle people....lie.

Some get paid to not produce peanuts, some take a loss to offset other income, some just seem to like to poor-mouth for the sake of fooling people.

Make them an offer to buy their operation at ten times whatever they tell you they are making.

That's how you figure out the truth.
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Old 11-04-2019, 09:02 PM   #22
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All cattleman lie a bit... Or there would not be so many.
How many are there versus city dwellers?
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Old 11-04-2019, 09:04 PM   #23
Atfulldraw
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$25,000 an acre ????? he wont be a billionaire for long.
did you actually do that math?

Him being broke is still about 40,000 acres away, and even if he paid twice what it's worth, he's still worth about 500 million more than most of us.
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Old 11-04-2019, 09:05 PM   #24
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$25,000 an acre ????? he wont be a billionaire for long.
Near going rate up here, you could never pay for land farming it. Even in NW Oklahoma where its cheaper you could still not pay it off farming. Tack on a hundred thousand plus for wellls and irrigation pivots
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Old 11-04-2019, 09:07 PM   #25
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Some people were going to buy land regardless, may as well keep beef. I have cows and goats. Cows because Ive always been around them, goats for the money.
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Old 11-04-2019, 09:08 PM   #26
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$25,000 an acre. How would he like some in Gonzales county, Texas
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Old 11-04-2019, 09:09 PM   #27
jds247
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It cost me 1.25 a day per head to keep a cow. That was 4 years ago and I figured everything from gas to grass.. anything that went toward the cow was wrote down for a year.. when I started 15 years ago on my own calves were around 1.30 a lb I looked the other day and steers were going for 1.45 trucks are 3 times as much feed is 4 times as high. Hay fuel etc everything has atleast doubled in price .. except the price you are paid for your calf at the sale barn.. I ran between 100 and 140 head for about 10 years.. I miss it and will eventually own a few head to mess with but it's a bunch of work for one person..

My grand paw told me if I wanted to make a small fortune in the cattle business you have to start with a large one..

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Old 11-04-2019, 09:14 PM   #28
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Default Why do people have cattle if its so unprofitable?

Cattle prices are down significantly right now, $250 profit per calf would be on the extreme high side. I can assure you that unless your land is paid for and you’re running at least 400-500 head then you’re probably not gonna make enough to live off of. Most ranchers are asset rich and cash poor.


Best saying I’ve heard is most people are still ranching/farming because they’ve got bills to pay, but the only reason they’ve got bills to pay is because they’re still ranching/farming.....

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Old 11-04-2019, 09:16 PM   #29
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Only way to make money in cattle is in numbers. You have to run a bunch of loads a year of feeder steers.


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Old 11-04-2019, 09:19 PM   #30
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Only way to make money in cattle is in numbers. You have to run a bunch of loads a year of feeder steers.


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This is how my Mennonite friends in oklahoma operate. They raise irrigated corn and peanuts for silage then plant rye.
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Old 11-04-2019, 09:20 PM   #31
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did you actually do that math?

Him being broke is still about 40,000 acres away, and even if he paid twice what it's worth, he's still worth about 500 million more than most of us.
Not doubting his worth, but 25K an acre for farm land seems like bad business to me.
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Old 11-04-2019, 09:21 PM   #32
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If people knew where the cattle market was headed all us ranchers could be wealthy. I've bought pairs for as high as 2500 and they now bring 1200. This was within the last 3 years are so. Good luck cattle ranchers.
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Old 11-04-2019, 09:21 PM   #33
Boss Buck
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All cattleman lie a bit... Or there would not be so many.
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Old 11-04-2019, 09:24 PM   #34
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All cattleman lie a bit... Or there would not be so many.
How many are left? You might want to look at stats. What are you calling cattle men? Just curious.
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Old 11-04-2019, 09:36 PM   #35
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Quote:
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If people knew where the cattle market was headed all us ranchers could be wealthy. I've bought pairs for as high as 2500 and they now bring 1200. This was within the last 3 years are so. Good luck cattle ranchers.
Yep. Before my boss passed away, he had us round up a bunch to sort for selling. Then after all that work was done he tells us to not sell.

So now, we just rounded up a large amount again to sell and they lost weight compared to the previous time. Ugggh!!!!

If my boss wasn’t making big bucks elsewhere, this cattle operation wouldn’t exist on such a large scale.
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Old 11-04-2019, 09:38 PM   #36
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I’ve seen less men who own cattle and know exactly what to do, when to do it, and how to do it then most of the other people who own cows and don’t do squat with them. They just go grab one and run it to the sale when they want some gun money. All the while they have cows dying of starvation in August.
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Old 11-04-2019, 09:43 PM   #37
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Tax break


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Yep. So they can buy $70,000 diesel trucks and write em off as “farm trucks”!
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Old 11-04-2019, 09:45 PM   #38
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Beef magazine has a lot of great articles.
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Old 11-04-2019, 09:51 PM   #39
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We’ve got 1000 head and took a loss this year, we make a living in the turf business. Probably start making money in cattle in a 2-3 more years.
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Old 11-04-2019, 10:00 PM   #40
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Yep. So they can buy $70,000 diesel trucks and write em off as “farm trucks”!
You know you can't write of 70k unless you make 70k, right?
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Old 11-04-2019, 10:01 PM   #41
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Yep. So they can buy $70,000 diesel trucks and write em off as “farm trucks”!
That's a low blow Buddy, we only do that in construction...
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Old 11-04-2019, 10:13 PM   #42
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I was drug into it. We work 365 days a year. No Christmas, birthday, MLK Jr day... Easter... 365. 3am- 10pm minimum. Land paid for and equipment. And we take money out of savings to pay bills.

I make less per pound of milk today than we did in the early 80’s.... land then was $400 an acre and a new truck was $16k

I can’t imagine the day when my dad leaves this world, but when he does there will never be another head of livestock in my ownership. It’s not a living it’s a hardship. I won’t leave my dad hanging out to dry he’s done too much for me but there’s a reason the state prison system stopped farming... it’s cruel unprofitable punishment (most of our original herd came from the prison sell out)
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Old 11-04-2019, 10:34 PM   #43
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I guess as long as the government keeps subsidizing cattle/chicken/pork/farming via tax write offs and such so that spoiled Americans can run out to any number of fast food restaurants and get a full meal for less than $10, people will keep raising animals and farming. And since I am a spoiled American, I am ok with it lol. But I can’t imagine doing it, there are much easier ways to make a living
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Old 11-04-2019, 11:13 PM   #44
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Quote:
Originally Posted by EastTexasMan View Post
Only way to make money in cattle is in numbers. You have to run a bunch of loads a year of feeder steers.


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Yep. It’s just like farming. It takes a few thousand or several thousand acres to make a living. The days of the small family farm/ranch were over decades ago.


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Old 11-04-2019, 11:23 PM   #45
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Losing money on cattle is a flea on an elephants butt compared to losing money on racehorses. Never have taken a racehorse to the vet that it didn’t cost a Grand or so.

No, they aren’t mine.

You know the difference in a Racehorse Addict and a Meth Addict?

SOME Meth Addicts can be cured.............
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Old 11-05-2019, 12:17 AM   #46
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I once saw a sign:

"Behind every successful rancher is a wife that works in town."
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Old 11-05-2019, 12:27 AM   #47
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So how much they make then? The guy in post 3 made $250 each.


Hahaha


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Old 11-05-2019, 12:39 AM   #48
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Quote:
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Tax break


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Quote:
Originally Posted by James View Post
Tax benefits
Can y'all explain these comments please? People are in the cattle business for the tax breaks? They actually are in the business to lose money so they can get tax benefits?
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Old 11-05-2019, 12:39 AM   #49
Dale Moser
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I wonder how this would have gone 4 years ago...

I feel for the small rancher, but trust that I’m doin my part boys!!! I’m eatin them sun itches as fast as I can!


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Old 11-05-2019, 04:48 AM   #50
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I was drug into it. We work 365 days a year. No Christmas, birthday, MLK Jr day... Easter... 365. 3am- 10pm minimum. Land paid for and equipment. And we take money out of savings to pay bills.

I make less per pound of milk today than we did in the early 80’s.... land then was $400 an acre and a new truck was $16k

I can’t imagine the day when my dad leaves this world, but when he does there will never be another head of livestock in my ownership. It’s not a living it’s a hardship. I won’t leave my dad hanging out to dry he’s done too much for me but there’s a reason the state prison system stopped farming... it’s cruel unprofitable punishment (most of our original herd came from the prison sell out)
Just out of curiosity what would be the need to be working with cattle at 3 in the morning until 10 at night? I have plenty of friends and family in the business some part time some full time. I'm not saying from time to time they might not have to take care of some things in the middle of the night but a 365 schedule from 3am until 10pm sounds unreal. Also being in the cattle business is somewhat of a passion, there has to be for the amount of work involved. I couldnt imagine hating something as much as it sounds like you do to " just make a living at it"
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