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Coming to a Cross Road

Bruce from Can.

Bruce from Can.

Well-known Member
Location
Woodville, Ontario, Canada
I am addicted to farming, and dairy farming in
particular. And I see that our farm is rapidly
reaching a cross road, due to changing rules
around milk production facilities. Manure storage,
when and where manure can be spread, and
generally livestock confinement. I had originally
thought that just building a manure storage
structure would take the pressure off, but it seems
that is only going to be part of the solution. We keep
our cows in a old tie stall barn, and there is
increasing pressure on tie barn operations to allow
cows more freedom to interact, and roam freely. So
we have been exploring all options. Including
retirement, but that will pull the rug out from under
the next generation, and wont make me happy
either. Trying to renovate our existing barn, will still
leave us doing a lot of physical manual labor. A new
barn with two robot milkers, liquid manure system,
naturally ventilation etc will cost around 1.5 million. I
am 60 and my son is 25 years younger than I.
Obviously it would be crazy for me to pull the trigger
on this, and expect to keep milking till I turn 80 to
pay for it, but my son wouldnt even be as old as I
am in 20 years. Not really looking for advice on
what to do so much as just sharing my burden of
what to do as I reach this cross road. Doing nothing
isnt a option, as with new rules our farm will no
longer meet Grade A. My son and I are very open
to each others thoughts and communication isnt a
issue between us..Retirement isnt very appealing
to me, and I dont like crop farming or beef cattle.
Trying to find the right solution to meet everyones
needs and expectations is my task. My wife and I
have had to go to the barn every day for over 40
years, and building new facilities would allow us to
have more freedom to enjoy ourselves, but still be
able to back stop our son, while his own kids grow.
Its a tough call, and I ultimately have to make the
choice, I feel rather pressured by outside forces to
act. And I dont like being in that position. And
nothing makes me feel as depressed as walking
through a empty dairy barn, with no milk cows.
 
You have a big decision to make. From reading your posts you live in a very high priced land area. Is selling your current farm and moving to a different area and building a new setup with a larger land base an option? It is very hard to move as it affects both you and all of your family. In 2005 we moved our dairy 850 miles to a much better farming area. The new setup sounds appealing but make sure your son is 100% into it. I know of several farms that built new setups and added cows only to have the children walk away leaving dad stuck with running or selling the new operation. My two sons like the farm but say they are not going to work for the income a farm can provide. Both have very good businesses of their own. Wish you the best as you move forward. Tom
 
A distant neighbor had a small dairy, his kids enjoyed being on the farm but ultimately found other things to do, and so he sold out a couple years ago.

A close neighbor is facing the same decision, perhaps in 3-4 years he feels his facility will need a rehab and will have to decide. One kid wants to farm but isnt into critters so very much, the others need a few years to decide their path. It will be interesting to watch it all evolve.

The govt is sure on the side of getting bigger, here in Minnesota there is a large milking group that is basically turning dairy into the same contract situation as hogs are and poultry became many decades ago. Progress I guess but kinda sad to see.

Paul
 
Just my opinion but an investment in your son is an investment in your future. What we saw in North America the last couple of generations in terms of retirement was a departure from what was seen in earlier chapters of humanity. I see humanity heading back to the earlier times where retirement meant a very modest existence with minimal discretionary personal spending. This means that the generations will be much more closely entwined which we saw historically versus the last 50-60 years where the kids left the nest at age 18 and had means to build a prosperous life from scratch. Just in the last couple of days we saw a thread here on how real estate keeps going up in value. That is happening because the Boomer generation is perhaps the best financed generation in history. What happens when that generation starts to fade (already happening) and the 45,000 dollar annual income Gen X, Gen Y, Millenials, etc.have to shoulder appreciation of real estate values. The short answer is that it can't do the lifting that a couple that made well in excess of 6 figures in terms of keep values pumped up.
 

You also have to anticipate where the "rules" will level out long enough to at least pay off the dept requirement to satisfy the current rules.

Seems maybe never ending as those zealots pushing for "rules" will never be satisfied.
 
Appears to me farming in general is going to have some big changes in the next 10 or so years.If you're into conspiracy theories I'd bet the big money that is investing in the mega agriculture companies are behind the rules like you are describing to force out what is now small time operators.The mega dairies/operations can handle the rules.Guys like Bill Gates aren't buying up thousands of acres for just to have a hobby,they will be the driving force in the future.
 
Many areas are under the pressure of trying to stay ahead of the rule makers. The farmers here in NY as of late have been made aware that our leadership is anti-
chemical when it comes to herbicides among other things. The trouble is that transitioning to another area or another business is far easier said than done. Most small
businesses around here for various reasons work for peanuts instead of making a prosperous living. For the most part we have watched the area economy here shrink
versus expand the past few decades. More doors staying closed permanently versus the next generation taking over.
 
A friend of the missus not that far from you on this side of the big river had that same decision to bake a few years back. A grandson wanted badly to keep the dairy farm going in the family. Went to the bank and they told them go big or go out. They went big, new barn ect ect. Didn't make it! Now they have no farm. I hope it works out for you whatever you decide. Best of luck.
 
Outsiders often don't have YOUR interests at heart when giving such advice. They have themselves and those who they favor that they favor over you. I know of a farm family facing a similar problem and the last thing I would do is send them to a wolf disguised as a lender.
 
I moved from my original farm to this area, 30 miles to the north in 2004, and moving a dairy is a big task. I have been watching the real estate market the past few years, even went and looked at a farm last December. Seems there are always compromises and trade offs in moving. To look at less expensive land on this side of Lake Ontario means looking at poorer quality ground, more hills, more rock, shorter growing season as you go farther north. Almost have to blossom where you are planted, as the saying goes, or wither and die out. There is a farm60 miles or so east of me for sale right now. Google Keen ,Ontario, Dairy farm, and have a look at the video. Not as good a land there, compared to where I am and more hills as well.
 

I too am at that crossroad.I am 64 years old,most times feel 84. I dont have livestalk,only a small 'penny operation' crop farm.Land is getting harder to lease. My wife's declineing health(mabe mine too?),economics are makeing me think about quitting.'Retireing'? Only I dont want to. Our county is still 'farmer friendly',but for how long with all the (city) folks moveing into the area?True,I dont have a huge financial investment/burden looming.Of that I am glad.My son doesnt want the farm,let alone try to farm it.But,yes I am at that crossroad. I feel for you and wish the best. God Bless.
 
Oh I hear what you are saying loud and clearly. As I look at different options available to me, everyone that is selling equipment or offering to provide services, has sharp teeth, and is hungry to rip a piece out of any lamb that wanders too close. I did have the good fortune of having a large network of dairy farming friends that will share past experiences with me in dealings with suppliers. This is a situation were I only get one shot at getting it right.. And there are many distractions
 
Tom, down below, makes a good point about your land value, and moving to an area with cheaper land, perhaps more suitable to farming. It would be a shame to build an expensive facility on land that may be 'doomed' for development in 20 years. My Dad faced a somewhat similar situation in 1971. We had the only farm left in the area. Our farm was located 5 miles south of Cincinnati, Ohio, in northern Kentucky, and the state highway department was going to build a circle freeway, I-275, around the greater Cincinnati area. When they built the road it was going to take the corner of our land where all the farm buildings, and also the farm pond which supplied the dairy barn, were located-about 5 acres. Dad knew about this for about 4 or 5 years and was stressed about it. He was 50. If he rebuilt a dairy barn, it have to be 'modernized' - pipeline milkers, bulk tank, etc.,- we were all 10 gallon milk cans- and so on. He did not believe he could justify the expense for the remaining years, and since the farm was whittled down to 33 acres it was not likely to be passed on, especially since he shared ownership with a brother and sister. Also the state would not compensate the value of the buildings, only the land they sat on, nor fence, and no compensation for loss of income or lively hood. What he ended up doing was- we sold the cows, tore down all the fence, all the buildings, and reused all the materials and built 2 beef cattle barns. He took his June milk check and had a pole barn built to house the farm equipment. To add insult to injury, arsonists burnt down the only barn the state did not take, which was full of hay. He raised beef until he was 69, selling direct to the consumer, and continued doing custom work with the tractors, and Mom ran the little store on the end of our house. Finally he and his brother and sister sold out to a developer in 1989. The land was too valuable not to sell by then.
He too was a lost soul without his cows- he took very good care of his animals-, but he had faced a lot of adversity in his farming career, losing his Dad, and his brother had left him to farm alone. So maybe by then it was a relief, and he stayed busy at his new home.
Good luck with your decisions Bruce, Mark.
 
I would never advise giving up productivity in terms of land. You have done very well from what i have seen. The replacement interval for replacing equipment would become longer, less crop inventory to be sold to fund expansion and/ or improvement, and less income to weather poor business years. Many people around here watched their dreams get beat down when the Co-ops paid on the basis of making only the most productive farms succeed. I crop farm but wish my soil was far more productive for any agricultural enterprise. This is where I was placed and never hit upon that break to allow me to start over elsewhere. It's a struggle that I live with because I as well am addicted to farming but a struggle that I do not wish others to face. Don't go backwards on soil productivity for the sole sake of staying in farming.
 
At 35 the son could ready to shift into the role of manager and decision maker, taking some of the pressure off dad. If you haven't already, this may be the time to bring him into meeting with the accountant and banker as he will be the one that will have to pay off any new investments made now. He can also invest his own money into the farm to eventually buy dad out. Are you both prepared for your roles to reverse where dad becomes the employee as the son runs the farm. That may only be a few short years away (5 years or less).

Take an honest look at where the industry is heading on the local level and on the national level. Those zealots are actually the companies that buy and process raw milk to sell to retailers, those are your customers, maybe your only customers. Your banker and accountant will have a better perspective on the industry than most farmers and most co-op board members.

Around ten years ago around Central Minnesota, high grain prices pushed most of the smaller dairies shifted out of milking into other livestock, cash grain, cash rent, or growing feed/disposing manure for the remaining larger dairies. Multi thousand cow herds are the norm here, very few herds are below 500 cows anymore. That is a lot of expansion to try to keep up with if you don't have a good long term plan.

Growing up in the 1960's in Western Iowa, the small 2 to 10 cow dairies run by mom and the kids went the same way. Hogs and beef cattle were more simply more profitable and less labor intensive.

Farming with you son and grand kids could be fun for all. I hope it works out.
 
A huge decision for sure. How fortunate that you have a son that is interested. How fortunate you both have a good path of communication. Many farmers don't have either one of those things on their side.

It sounds like the correct decision will be made. After that decision is made, everyone involved is entitled to a big piece of pie !
 
You can't take the money with you when you go. Use reason and common sense and do what makes you happy.
 
Common problem all over Canada right now. Two people I know went for a gut of existing tie stall barn with the mats etc, big fabric building addition to the side, robot on the path in between, and manure tank plumbed in during the work. One has aisles setup better for faster drive thru feeding and barn is all scraped on timer, he works a day job too. The other needs skid steer to scrape into a sump and takes more manual work feeding. Full time at farm but grows other crops too.
 
At age 35 the son should be ready for the role of manager unless he has willfully ignored such opportunities or has been excluded from them. Lets pump the brakes on buying dad out. That may or may not be a possibility depending on the family and its financial structure. Only Bruce and his son know if this is possible based on each's expectations. Your opinion most likely is well intentioned but many out there would throw out such advice as they are jealous of others that have what they do not. One of the most successful younger farmers in my community had his father gift nearly all of the farm over to spare the son a ruinous debt situation. Don't let speculative coffee shop talk take the place of hard mathematics in trying to sort that out. All that aside dad should be communicating his intentions of wanting a buyout very early on in a father son business so the son can figure out what needs to be done versus being blind sided as a middle aged man.
 
I really am not in tune with the prophet margin of dairy farming. Is the most efficient dairy one that has just the right ratio of cows to land? In other words can a 300 acre farm support maybe 100 cows whereby all crops are run through the cows and no feed needs to be bought and no extra crops need to be sold. I know this doesn't pertain to you or your cross roads Bruce but I'm just curious.
 
my wife suggests that you and your wife and son pray about the situation. Listen and he will help steer you in the right direction. When you are lost and do not know which direction to go, look up.
 
I dont have much to add to whats been said but it sounds like you are exploring all options, which is good. it will take a while for you to come to the decsion best for you and your family. I would say that I agree with everyone else that moving to an area with poorer soils, shorter growing season etc would probably not be a good idea . If you have a choice to sell your farm for real good money and relocate to an equally productive farm with some of the improvements you need at a lower cost that might be an option. Best of luck to you and your family, your posts here are always interesting.
 
Bruce
A lot of good advise here so far but one thing that hasn't been mentioned. Do you own the ground that you get your silage & hay from or is it rented. If it is rented You & your son could be forced in the next 0-30 years to buy it no matter what it brings or you are out of business because you have no ground to grow your feed on. Good luck with your decision.
 
I think we are on the same page. Passing a farm to the next generation takes a lot of planning and cooperation. Estate planning, formal partnership agreements, or incorporation can be complicated but fruitful tools to get there.
 
Without checking any dairy surveys such as what Farm Credit puts out but I would guess the more profitable dairies run at around 2.25 acres per adult lactating cow. 3 acres per cow is somewhat inefficient at least for the Northeast.
 
I didn't read all the comments : but I know the tie stall does not have to be removed. The problem is you need another building where they spend the day in not tied on. My neighbor just built a biotek to house his cows in. he still milks in the tie stall barn and it is as old or older than yours. He feeds his cows outside and in the biotek. just inside on the coldest days. even then the cows will go outside and eat silage when the 2nd cut hay is inside. He has no running water in the barn anymore for each cow as he thought it would freeze up the pipes. He says the barn actually only freezes on the end where the big door is where the cows come in. They seem to produce enough heat the 2 times a day when he milks them that it stays just above freezing. This might be an option for you and your son if you don't want to go to robotic milking. As far as manure when you feed them outside it ends up in a straw pack and you don't need the big manure tank for storage. If I am right you only have to have a place to stock pile it once a year and let it compost an spread the next year. Because you have your manure all inside now, they require the holding tank as it is kinda liquid. once you move the cows out I believe that part of your problem will be alot easier to deal with for less money. You and I know that the changes they want you to do will not make those cows happier or produce better milk.
 
Move to manitoba or Saskatchewan if you want more room. Land is alot cheaper as well. That would maybe be hard as family ties are hard to break.
 

Sounds like a lot of good advice in this thread other than one ridiculous piece but I'll leave that alone.

You're in a tough spot. I can't give you any advice because I don't know enough about the topic to give advice on it.

I don't envy you and the decisions you and your family will have to make. I do hope whatever is decided works out and everyone will be happy.
 
I have no problem growing enough forage and bedding, and buy dairy ration. Growing grain for dairy cows, to me doesnt make sense. As the grains value has to be factored at the price it could return if sold on the market. And is best left to farmers that specialize in growing crops. They have more efficient equipment, and can get inputs at a better price than I ever can
 
I know how you feel. I was 16 when we sold our cows in the 60's and going through an empty barn for a couple of years before we sold the farm and moved even at that age was sad to say the least. I would bet the problem is some hot shot politicians who want to sleep better at night has decided the kind of rules they want to impose on others will improve the world. What would improve the world is for the hot shot politicians to actually do something useful and most of them them don't how.
 
Traditional, boy do i agree,In South Dakota they brought in a Mega Dairy Farmer, from Ireland to milk cows, here in South Dakota, to keep the three Cheese Plants in Business, from what i got out of the article, it must of been a good incentive,to move!
 
I am in agreement here. The som and His family (if there) is critical in the decision. Not only the investment, but the radical change in process. Best of good fortune comes from best of all decisions. Best decisions are made with information. Jim
 
It is not the politician that has elected. Its the bureaucrats that sit in some office cranking out rules just to justify their existence
 
I wanted to move to Manitoba in the early years of 2000, but my wife wouldnt go for it. I have a brother in Winnipeg. And the area south of Winnipeg was very appealing to me. Back then our quota was almost twice the value of quota in Manitoba, and I could have traded one kg of Ontario quota for 1.5 kg of Manitoba quota. Now my wife realizes that probably would have been a good idea, but now my sons wife would have to agree as well. Leaving parents is much harder for the wives it seems. Down side is , parents pass away, and you stayed to be close to them, but they are gone anyway
 
Agreed, but that was the only way the bank would lend anything. They had a pretty big farm already.
 
Bruce, my advise to you is to sell out and spend the rest of your lives together dong less stress full things. I am 80,in good health, my wife of 52 years just passed on Jan 25,2021 at the age of 76, not nnalert, not cancer, not heart attack. we were planning on doing more traveling after this nnalert was over, but now my life has change drastically. We only live once, enjoy your time left together. Just my two cents. If you are a country music fan check out Billy Deans Hold what needs holding
 
Sorry for your loss. And I am a country music fan, old country and bluegrass, not so much the new stuff. My wife and I enjoy very much doing things on the farm together, and have been able to travel a little in the last 10 years. Dont think I could ever just sell everything out and be happy living away from the farm. There is only so many things that I would want to travel to see. Really dont like going to places with crowds. Like my kids to be able to come and have their kids experience some farm life too. Something that very few kids ever get. I do understand your thoughts, we only get one chance at life, and need to get the work /life balance thing right.
 
My son is facing the same situation on this side of the border also Bruce. Goobermint peckerwoods who don't know which end of the cow to shovel in and which end to shovel out, telling you how to run a your business and care for your animals. He's in his 40's but he has two daughters whom are not sure if they want to continue the farm and whether or not one of them hooks up with some guy who is worth more than a handful of ragweed seed remains to be seen. If either of the girls decide to stick with the farm, he doesn't mind making the changes, and if they don't his goal is to walk away in 20 years or so and have money left over from the sale, instead of still owing a ton of money. Hard choices.
 
You are right. I always say that traveling 3-500 miles today to go visit every 6 months is no big deal. 50 years ago it was alot of ones monthly income to travel that far. Today it doesn't seem quite as bad.
we drive just short of 400kms almost every month to visit my wifes parents. cost about $60.
small price to pay if you can live in an area where the living is cheaper and less people.
My 2 sisters are 600kms round trip and come into this area 5-6 times a year. As a family we just have a gathering every time they come out this way.

I would move in a heart beat but my piece of land is good for only the hunters or campers and not ideal crop land. I make a living here with a little trucking on the side but the land is so hilly and swampy nobody else around would buy it. There is a creek runs through and can only crop 65 of 160 acres. I rent the other 1/2 section just like mine and can only crop 114 acres. Good for some pasture but that is it.
 
One thing is for sure, you can't take any of it with you when you die. If you like what you are doing and can afford to make the upgrades, do so. Best case is that your son takes over and you've got him lined-up for years to come and you can continue farming as long as you want/can. Worse case - you make the upgrades and you are forced to retire (for whatever reason) and you're son is not interested - either way, you're probably selling part or all of the farm.

Best of luck,
Bill
 
Just like my favorite song . Thank God you werent born any latter than you was . I wanted food price to triple now its going up but we still wont see any of it . Will all go to meet the requirements of the people that the closest thing to a farm they ever seen was on an aspca commercial
 
The best advice would to be having frequent discussion on transitioning the farm business. It can be sometimes painful to see the attitude of child or parent but better to see it now while many choices are out there for all involved. The worst thing to do is bury the matter until everybody is older and crankier. You can call me crazy but a family farm might be comparatively stable to what else is out there in the economy a couple decades into the future. That is where I am at having analyzed my skillset many years ago. I sure wish I had that math gene that would make becoming a scientist a reality but it never took hold in me.
 
Bruce,the answer is in front of you...on 4 legs...just change cow brands, & believe you will come to treasure beef cows...very similar chores...u & wife, can even name them...be blessed, grateful, prepared...
 
Bruce, You face a challenge like many other have had to face. It comes down to MONEY! See what you can swing and your son will have to chip in as well. You, your wife and son will have to factor in the Quality of life for all. You are a smart guy and will figure it out. If money isn't an issue, then it comes down to If you want to. If you son REALLY wants to dairy, then go for it. Fill the barn with beefers is another way to keep farming. Bill
 
It is a dilemma and I have no answers or advice. I worked for a dairy/mixed farm operation for almost 10 years. When I decided to leave the cows did too. Still feel badly about that and feel that I tipped my bosses hand. Hanging up milkers for the last time was like a funeral.
Brother in law had a partnership with his brother and had milked together for their entire lives. The city was closing in and every decision for 25 years revolved around how long will we be here?. They split the herd in half, J bought a farm 40 miles away, built a new freestall barn and started over....when he was close to 50. Retirement wasn't considered. Today he and his son milk about 75. Yup a small herd by current standards. A neighbour here added a freestall type barn (sand pack floor I believe) to turn cows into after milking in the original tie stall barn. It seems like a lesser investment in some ways but all things cost
 
That's a heck of a chunk of change. What would it cost if you went to a double 4 instead of robots? I don't know how things are oriented, but could you build the parlor off the old milk house and use your current receiver and wash system? Then convert the old tie stall to calf and young heifer housing by taking out the stalls and cementing in the gutters?

What kind of new problems are you going to have with frozen teat ends and icy floors?

I know you guys make more money with your quota system and that's why you'd even entertain such an idea, but you're faced with the tradeoff that you guys have in the control that the government has over animal care. That kind of investment wouldn't even be on the table over here west of you.

Just to wander a little, the wife's greenhouse business has grown to the point that we're putting up a bigger one. There's one just to the north west of is that's closing due to the owners retiring. That one was just a converted calf barn on a former dairy farm. They built that whole new dairy set up in the early 70s when I was in high school. We went over there a week ago last Sunday and got the fans, tables, furnace, louvers, a whole bunch of stuff. I was telling the boys that when I was in school, our ag class went out there for an open house when they built it. It was one of the most modern and largest dairies around at that time. They couldn't hardly believe it anymore than I can anymore. It's just another 100 stall barn with part of the roof blown off and a few 20x70 silos. It was built by three brothers when their dad was retiring and they thought they had to get big and modern to all stay in the dairy business. It was in the local paper and even Michigan Farmer Magazine, quite a big deal when the whole family got involved and built it.

I don't know, for me, there aren't any regrets in getting out. I thought dairy farming was my entire identity. I started milking at the end of my sophomore year in high school. I hauled milk for two years after I graduated, my wife and I were Outstanding Young Dairy Couple in 1990, I was heavily involved in Michigan Milk Producers Association. You know what though? I'm still me. Everybody I knew before, I still know now and they still know me.

It was easier for me though, because from the time I was old enough to see out of the car windows, all I really wanted was a herd of Angus cows. In this area of Michigan at the time I was in high school, you were pretty much were going to milk cows if you planned to make a living farming and that's what I did. My dad and grand dad both milked here before I did. There are pangs of hurt when I go in the barn yet. Dad was still alive when I quit milking, and I've sold all the milking equipment and converted the barn to pens and a chute for sorting and handling beef cattle, Dad's denim coat still hangs on a hook behind the door in the old milk house, yellow gloves still in the pockets. He got hurt at home and couldn't milk anymore and never came back to get the coat.

To be honest, I was looking hard for a farm down south and would have moved down there to quit milking if I had to. My brother was going to buy the home place and I was going to sell the rest to whoever had the deepest pockets. The more time I spent down there, the more it seemed apparent to me that guys up here who were going to beef cattle had never been to real beef cattle country. I didn't think it would even work here, but I modeled things by what I saw in the south and it has worked so well, it even surprises me. My wife was working as a nurse when I sold the dairy cattle and the boys had jobs. I really didn't think I would ever do any better than break even and we'd live on what the wife made. Amazingly, she hasn't worked in over 10 years and we're making a good living.

I'm rambling. Don't take my advice for anything. I sure didn't take anybody's, and nobody was advising me to quit milking and do what I did. It's like I told my cousin though, Everybody says I can't make it with beef cows, but I can if I want to.. Whatever you decide to do, you can if you want to.
 
Bruce,
I'm 72, retired 17 years. I have made a trust for my son and daughter. My estate is debt free. I can't imagine borrowing $1.5M. We will all die someday and the last thing I want to do is leave my kids a large debt. The bank would own my estate, not my kids.

You may want to figure out how to give your kids the dairy, they go in debt, and they can hire you to run the dairy.

Or talk to a lawyer for the best advice on how to pass the farm to your kids. Perhaps get life insurance to pay for the debt if you don't live to 80.


George
 
Bruce,
Your answer is in your first sentence. You are addicted. The next question would be is your son and grandchildren also addicted???? This is very important. I come from a similar background. Dad died when I was ten years old and we were milking thirty five cows. My childhood ended the day he died. Mother and I were milking the day after he was buried and that was 10-29-1951. Although I knew at the time that it was our only source of income I never became addicted to milking cows. After about twenty years we switched over to crop farming and never looked back. I retired five years ago at seventy five and had a new home built in Arizona. We spend the winter season here and the summers on Lake Charlevoix in Michigan. Several miles from here there is a dairy operation that milks 22,000 cows twice daily and any time I need to be brought back to reality I drive by this place. They say all things change but I can tell you that the smell of cows has not changed in fifty years. Most all farmers compete against each other whether it be dairy or crop or even specialty crops. Think about trying to survive competing against an operation like this where they have reasonable land, cheap labor and sunshine the year around. They feed twelve semi loads a day of fresh chopped alfalfa every day of the year. I told my wife that if those cows don't give milk on that alfalfa they deserve to be hamburgers. You need to give the real problem a lot of thought and treat the addiction.
 
Even though I was rather young at the time I recall the get big or get out talk being pushed by the ag university system and the lenders. It hurt bad when dad sold the cows but it was the best thing he ever did. He took greater control of the farm by not having to answer to the bank every time milk prices receded. Cows were never his strong point so it would have been pointless to struggle for many years and lose equity at an accelerated rate. The farm is here today and without debt on any equipment or real estate. Life is not prefect by any means but at least we are not trying to figure out how to pay a six figure mortgage.
 
Oh, and the professionals carped on how you could not farm using decades old equipment. The last guy to milk in the neighborhood had at the newest a 20 year old tractor as the main worker.
 
It's very simple, Yogi Berra figured it out 70 years ago. He said If you come to a cross (fork) in the road, take it
 
We have been kinda going down parallel paths Randy, you are just a tad older than I . It is a heavy chunk of change to sign on for, no question about that. It would suck up about 75 grand each year for 20 years to make the principal repayment, plus interest. The new barn would have roughly the same value as the 166 acre farm I would put it on. This farm is today free and clear of debt. The pay out for milk here in Ontario is based on composition, higher fat/protein, the more you get for the milk. Our cows are Jerseys with 5.3% BF 4% protein which gave me a payment last month of $101.13 per hundred litres. Cost me $60.00 per hundred litres to produce the milk. So I am nearly receiving a 40% profit margin. The provincial average pay out last month was $80.00 per Hundred litre. I know it is difficult to translate into American funds from Canadian and from litres to lb. but you get some idea of the rate of return on investment. And we arent carrying a heavy debt load currently. So with these bits of information, you probably can understand better why I would even think about doing this. Over the past ten years ther have been dozens of barns just like this built around me. No one ever has issues with frozen teat ends in these barns. Some do have to provide heating for the robot.
I have been milking now 40 years, and could switch to beef, sell my production quota and be debt free with cash in the bank, but that leaves my sons future in limbo. I have two farms 5 miles apart, I live on the one we milk at now, but there isnt any good way to link into the existing dairy barn because of the lay of the land. And I doubt I could even get a building permit on this place because it is too close to town. I have two years to make a decision. We are overwhelmed with greenhouses here, so much so that some have gone broke and been torn down. I wish you luck with your wives green thumb!
 
1.5 mil at today's rates and what interest rates have been for how long? 2009, 2010? My son has come to me with a wondering, a hope, a dream, if he might, as I suggested to him, buy my brother out of our small 49.5 acre farm so as to facilitate my brother's estate planning. I'm for it as when you give up title it's gone. My son looks at servicing a debt of 4 hundred thousand for a house, between 3-4 hundred, as what it takes to buy into today's housing market where we live. My son isn't a farmer and quite likely won't be. He's closing in on his 5th year of an electrical apprenticeship and sees himself as a journeyman making up to a hundred grand a year, so sees himself as being able to service the debt without help except from me. One issue here is we have 7 acres of bush ground of which in this township is rare. Dover township has less than .05% of any natural tree cover. So it's a bit of a sweet spot for a tree hugger. An issue with that kind of debt is interest and what interest is apt to do in the next number of years? I believe in the future and that is, your son and his family. My grandmother used to say, if you don't know what to do, don't do any thing. My Dad used to say there's nothing like a warm barn on a cold winter's day, you, by the sounds of it know how barns stay warm. The problems we have are luxuries really.
 
I was 48 when I hung it up. I offered both of my sons the same deal, half the milk check, all of the calves, I'd get the money from the cull cows until all of my cattle were gone, then they could start buying land. I would have gladly stayed around and done pretty much everything I had always done if they would just start taking on the management and the mental strain. I don't know if it was a good thing or not that they didn't take me up on it. I know beyond a doubt that they're better off in every way since they moved on. The older one wants to farm, but when I told him that he might be able to do it by the time he was 60 and I was dead, he said that'd work perfect.
 
I think the big question is ...is your son ready to assume your role as owner operator? The upgrade or conversion will figure itself out in terms of dollars and labour, but are you ( as in you and Genevieve) ready to hand over the reins? Are planning and managerial tasks part of your sons job description? He ....and his spouse...have to be at least as capable as you are in running the show and maybe even more addicted to it to be successful. There are a number of farms here where dad has hung on too long, and the kids were basically his hired hands and as a result the kids were ill prepared to manage the operation and lost the energy and drive young farmers need to have. As well, how do you transition the farm and manage the wealth in such a way to be fair to the rest of your family? A fair division of assets that provides a decent living for the one buying the farm, for you and G to have a comfortable retirement yet remain as active and involved as you want, while providing something to your other kids eventually is like trying to juggle 3 eggs....it can be done, but if you drop one, there's no going back

We were in much the same boat in 2005....ready to renovate for ease of operation for the next 10 or 15 years, but with no kids interested we decided not to....only to have a life style changing health event a few years later, which would have cost us the home farm had we assumed the million dollar debt. Now, as I face a nother health challenge, the question is do we keep farming or rent/sell and move on. And now, one of my girls is showing a growing interest in farming...yea, great! So, we hang in until my health stabilizes and go from there.


Good luck to you , Genevieve and your son. It sounds like all of you are well prepared to deal with the future and with communication, the answer will become clear. Feel fortunate that you have lived your dream...very few people get to do that, and I feel extremely grateful....and humble...that I have been given the chance to do so.

Ben
 
You bring up an excellent point Ben, in asking about the son and management. I won't get in to specifics, and what I'm going to refer to didn't involve a farm, but rather a different business, but the dad had built a successful business and had a son working with him. Somebody asked him one time how the son was working out. He said great, at the end of they day he's always asking if there was anything else to do.

I thought right them,that's a big problem.If the boy was ever going to be successful in business, he wouldn't have to ask, he'd know what had to be done and would just do it. The dad must have figured it out.The boy went to work somewhere else doing pretty much the same kind of work and the dad has pretty much retired.
 
Just a couple of thoughts on the big picture. You have worked hard all your life and have created what can be a very nice secure retirement.
Risking much of this by taking on a lot of debt at your age might be a gamble bigger than you really want to live with. In this time of rapid change in so many areas of business and life that are beyond our control none of us can predict what things will look like 10 years down the road. What is to prevent a whole new group of regulations coming down the line which might require even more debt.

Just a thought, maybe sell the farm closest to the city at what is probably a very good price, invest the money and live on the income from it. Let your son assume ownership of the other farm and see how he does on his own without a huge debt load and you can still help him working there as much as you like.

Remember the time to sell is when you have a buyer. I remember what transpired back in the 80's when we had 20% interest rates and effect on farming. All this free government money is going to have an effect on inflation and interest rates down the road and having liquidity may be very valuable to us.
 
You can tell who the farmers are . We love it and we dont want to ever leave it for anything and sure not to just retire and go play golf .
 
as I came down stairs this morning I was thinking how nice it is not needing to think about feeding cows who is going to calve next where do I buy next load of hay when will Tall Kid be home to feed more hay.
His job will be soon working 10 hour days then more on Saturday and sometimes on Sunday.
The cows weren't his I don't think he will ever own cows of his.
Then yesterday neighbor asked about buying tillable ground I talk to banker at 230 today if I sell the dirt I will be debut free.
Most of my 72 years have been spent around cows they grow on you
 
Bruce I can certainly relate to your situation. A friend of mine that I also worked as a relief milker went through this about six years ago. His son had surgery and had someone hired to fill the son's position. The help went off the deep end leaving leaving my friend and his wife with the whole operation. I could only help out so much as I had a full time job and could not milk both morning and night. They were milking about 90 cows in a 70 cow barn. He was in his later 50's and the son was in his mid 20's. So the decision was made to install a robot. They converted the dairy barn to accommodate the robot going down to 63 stalls (They had installed comfort stall in the barn previously). With changing to TMR at the same time, they are producing the same amount of milk as they were with 90 cows. The cows are now milked about 2.7 times a day in the robot. It has worked out very well for them. With the extra feed they have started to raise a few beef cattle and need to buy less feed. The son is being brought into the operation and because of some serious health issues of my friend's wife, he has had to step up more. The son is the eyes and years of the robot. By no means is my friend ready to retire. This operation has always been set up to allow vacations as long as I can remember and with the robot it does allow more quality of life time,
 
You pretty much answered your own question. You want to keep going and you
would like future generations to continue the operation. So,the question is if
you build a new set-up, can you exit in case some unforseen circumstance happens.
If you can, it's pretty simple. continue doing what you enjoy and allow the next
generation to enjoy it. I have a lot of respect for you and what you and Gen have
done. Please pass the pie!!
 
(quoted from post at 07:03:08 03/24/21) I am addicted to farming, and dairy farming in
particular. And I see that our farm is rapidly
reaching a cross road, due to changing rules
around milk production facilities. Manure storage,
when and where manure can be spread, and
generally livestock confinement. I had originally
thought that just building a manure storage
structure would take the pressure off, but it seems
that is only going to be part of the solution. We keep
our cows in a old tie stall barn, and there is
increasing pressure on tie barn operations to allow
cows more freedom to interact, and roam freely. So
we have been exploring all options. Including
retirement, but that will pull the rug out from under
the next generation, and wont make me happy
either. Trying to renovate our existing barn, will still
leave us doing a lot of physical manual labor. A new
barn with two robot milkers, liquid manure system,
naturally ventilation etc will cost around 1.5 million. I
am 60 and my son is 25 years younger than I.
Obviously it would be crazy for me to pull the trigger
on this, and expect to keep milking till I turn 80 to
pay for it, but my son wouldnt even be as old as I
am in 20 years. Not really looking for advice on
what to do so much as just sharing my burden of
what to do as I reach this cross road. Doing nothing
isnt a option, as with new rules our farm will no
longer meet Grade A. My son and I are very open
to each others thoughts and communication isnt a
issue between us..Retirement isnt very appealing
to me, and I dont like crop farming or beef cattle.
Trying to find the right solution to meet everyones
needs and expectations is my task. My wife and I
have had to go to the barn every day for over 40
years, and building new facilities would allow us to
have more freedom to enjoy ourselves, but still be
able to back stop our son, while his own kids grow.
Its a tough call, and I ultimately have to make the
choice, I feel rather pressured by outside forces to
act. And I dont like being in that position. And
nothing makes me feel as depressed as walking
through a empty dairy barn, with no milk cows.
Click to expand...

Sounds like you have a 20 year payback calculated.

Does you son have the same enthusiasm for dairy as you do? Sounds like he'd be almost your age now by the time it's paid for. I'd say if your intent is to keep things going for him, he has to be 100% committed to it.

Been a few small dairy farmers here that sold off the dairy herd and quota and kept everything else (land, barns, equipment) and switched farming to something else. Not sure if there were succession issues or same thing you are running into with regs.

I'd be calculating what interest you'd get on investing the money the quota and cattle bring as a comparison, minusing off the 1.5 million you'd have to spend and not increasing your farm income at the same time.
 
Bruce and family lots of good advice in the replies. My grandpa always told us when time to make decision listen to everyone's opinion then do as you darn well please. Good advice but really does not help until you know what you want to do. Best advice to figure that out is to know God and know His will for your life. He knows the end from the beginning so consult him first and often for these next 2 years you have to decide God will lead you to a place of peace and understanding then you will know which path to take. God bless.
 
Bruce,My milk cows left when my cross road was expand or get out.I didn't own the farm at that time. They do make portable milking parlors and portable units with robot milking units. Would make moving to another farm alot easier or resale better on milking equipment.Best of luck with future plans
 
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