Well started farming 3 years ago with 14.5 acres of corn made a profit the first year made a small profit the second year with 37 acres now 2014 I had 65 acres of corn and a few acers of beans with the best yields out of 3 years and lost money! So scratching my head on what to do next year! cause I have the oportunity to ad another 100 acers to my 65! o well guess you gotta take the ups and downs!
Allan in NE
Well-known Member
Farming making money? Comon' now......'taint gonna happen.
Allan
Allan
If I had to guess the bean acres carried the day so to speak. You need to do a crop enterprise analysis which is not practical to do here. Can you talk to the county extension agent or are you working with a bank? You can't run your business like you are working the tables at the casino. More advice would be to limit the corn acres to the point where you know you can make 180 bushel corn 8 out of 10 years. Even if it means growing only 5 acres of corn. Put the rest into beans for 2015 and then go from there. I suspect there are a fair number of acres of corn this past year that did not measure up for you.
steven meckstroth
New User
Old sage wisdom: You know how to become a millionare farmer? Start with two million. ...
Brown Swiss
Well-known Member
Ain't you the one who got hitched last year? If so that is where it went! Just kidding.
Ted in NE-OH
Well-known Member
You need to get the Government to pay you NOT to farm.
fixerupper
Well-known Member
Don't get discouraged from one bad year, that's the way farming works. You win some and you lose some. I don't know of any grain farmer who made a whole lot of money this year. If it wasn't for good crop insurance I would have lost big time this year. One 60 acre field that I rent from a separate landlord lost me $220 per acre with crop insurance because of a large percentage of drown out. The reason I'm not giving up on that field is it's made a modest profit for the past 9 years. Luckily the rest of my land showed a small profit. In this area we had low yields to go along with the low prices so we optimists just have to look forward to a possible profit next year.
Eldon (WA)
Well-known Member
Sounds like you are right on track.....
Traditional Farmer
Well-known Member
- Location
- Virginia
Go sign up for a bunch of Gov't handouts thats what 'real' farmers do I'm told.
Yeah, I know the feeling. There were a couple that were capable but unless you were a BTO they had no time for you. I still carry a bur on my tail for the one guy right to this day.
This is too important and in depth to try to handle his problem here. He needs to do a complete analysis of his business. Something is wrong if he had his best yields in three years and lost money. Prices are down but not that bad. What's rent? How soon is the crop being harvested and what is being paid for drying. I heard of one area BTO drying most of his corn in the mid-30's moisture-wise but he has other incomes that helps make those decisions. The yields are not that good here for the average Joe to be drying his crop at 35 percent moisture. Sometimes guys think they can emulate the big guy but that can be fatal business-wise if you do not know all the facts behind that guy's decisions. I remember my first year at college that the farm manager prof used to say just because the neighbor can afford the big blue silo does not mean that silo on your farm will not break you.
This is too important and in depth to try to handle his problem here. He needs to do a complete analysis of his business. Something is wrong if he had his best yields in three years and lost money. Prices are down but not that bad. What's rent? How soon is the crop being harvested and what is being paid for drying. I heard of one area BTO drying most of his corn in the mid-30's moisture-wise but he has other incomes that helps make those decisions. The yields are not that good here for the average Joe to be drying his crop at 35 percent moisture. Sometimes guys think they can emulate the big guy but that can be fatal business-wise if you do not know all the facts behind that guy's decisions. I remember my first year at college that the farm manager prof used to say just because the neighbor can afford the big blue silo does not mean that silo on your farm will not break you.
sadly that sounds about right for this year, Nice good yield but still lose money.
To give you an honest/best answer on whether you should pickup another 100 acres. It depends on your equipment and you.
can you handle the time and money needed to plant and harvest the extra acreage. If the answer is yes then put pencil to paper and make your determination from that point.
Everyone that farms loses money now and then. You would think that since people need to eat you would be rolling in the money but it doesnt seem to work that way
To give you an honest/best answer on whether you should pickup another 100 acres. It depends on your equipment and you.
can you handle the time and money needed to plant and harvest the extra acreage. If the answer is yes then put pencil to paper and make your determination from that point.
Everyone that farms loses money now and then. You would think that since people need to eat you would be rolling in the money but it doesnt seem to work that way
ow don't be so pessimistic,.one can make money with farming but he needs to think outside the box and willing to change and dare to jump.
I had grain, i had dairy,i had pigs and beef,..all a no go and going backwards
But when i switched the operation to only raising Bison in 96 the world opened up and i never looked back, the workload and the cost disappeared and the pay check took a jump upwards.
The ranch will be payed off this year..All 1800 acres of it.
I own the animals and machinery outright already and have enough money in the bank to last me this year + i still have a hundred yearlings to sell come fall for next years pay.
Save for a disaster(knock wood), this spring there's gonna be a new calf crop on the ground that should get me trough 2017.
I ain't complaining:wink:
JD Seller mention a while back about land rents in his area. At 400-500 an acre plus close to 400 in inputs can kill any chance of a profit in a hurry once you add in harvesting, drying, trucking and storage.
Take a smaller guy, even with lower rents, if they are paying for someone to harvest for them can still lose money.
Rick
tractorguy2
Well-known Member
I rented my farm in 2006. I kept 14 acres to play with. The last couple of years the chemical bill has been over $1200 gets higher every year. I get about $600 $800 for the wheat.
I now have the 14 acres rented for $85 and acre.
I now have the 14 acres rented for $85 and acre.
Markets seem to go in cycles that are not entirely predictable. We grew corn for decades. When I started corn was $20 a bag and fertilizer was $60 a ton. Got about 80 bushels per acre at about $1.50. Used most of it thru dairy cows.
Also, we developed an off farm income that turned out pretty good. Today is a whole different story. Unless you have off farm income to offset any losses and an understanding wife, it would be a tough rode to hoe.
I would jump over to Agtalk.com and click on the marketing forum. Read it for a few months. Quite often some guys post charts that are quite enlightning.
Also, we developed an off farm income that turned out pretty good. Today is a whole different story. Unless you have off farm income to offset any losses and an understanding wife, it would be a tough rode to hoe.
I would jump over to Agtalk.com and click on the marketing forum. Read it for a few months. Quite often some guys post charts that are quite enlightning.
Brian there are too many things we do not know about how your raising your crop. The biggest yield is only good if you did it efficiently. You want the maximum return with the best return to investment ratio. Meaning that you can make more money some times without the highest yield.
IF you are just planting the crop and then selling at harvest to a local market than I say your in trouble. You need to be a GOOD marketer as well as a good producer.
My sons and I have cash sales locked out three years in advance right now. The major inputs are either locked in or price protected. This is on a portion of our expected yield. Then we sell more as the crop conditions and market dictates.
Here is some simple hard facts for the cash grain business for the next few years. The price of the sold products is going to be out of sink with the input costs in many cases. Just as guys made wind fall profits when the grain market jumped there will be guys LOOSE now that the market has fallen.
IF you are just planting the crop and then selling at harvest to a local market than I say your in trouble. You need to be a GOOD marketer as well as a good producer.
My sons and I have cash sales locked out three years in advance right now. The major inputs are either locked in or price protected. This is on a portion of our expected yield. Then we sell more as the crop conditions and market dictates.
Here is some simple hard facts for the cash grain business for the next few years. The price of the sold products is going to be out of sink with the input costs in many cases. Just as guys made wind fall profits when the grain market jumped there will be guys LOOSE now that the market has fallen.
T in NE
Well-known Member
- Location
- Cambridge, Nebraska
The only thing predictable about the markets is that the longer they stay up the faster they crash. And it's not if they crash, but when.
DAVISFARMS
Member
WERE are you located I would take the other 100 acres.Donald nnalert cant rent land in my area lol.
DAVISFARMS
Member
My corn broke even at 170 bushel at 3.40 beans brought me thru 45 bushel @10.05 to 10.30 you have to watch inputs close.I share crop most acres makes for high rent some time 50/50 split is best for me
The best way to hedge your own production is to grow your business only at the rate that will allow you to self finance. If you have the money to put in and harvest the crop without borrowing then you don't have to sell at the elevator price to meet a note, you can wait for the price to improve or sell privately, grain bins are cheap and worthwhile investments.
I would comment that here in the East there are a number of elevators that have worts of some kind so I would use caution in terms of making large commitments relative to anticipated crop size. If I were Brian I would want to get a few recommendations and know that nobody is out to shaft Brian as far as deliberately bad advice. Some guys lack for local markets altogether and have a hefty trucking bill for running commodities 75, 100 or more miles one way.
JD Seller -- wouldn't you be better off right now running all of your corn through cattle? On average, there is 7 pounds of beef in a bushel of corn, with corn at $3.00 it does not take long to figure out that any class of cattle will yield at least triple that price per bushel gross, some classes would yield 5 or 6 times the elevator price. I don't think there has ever been a similar situation to the present corn/cattle price scenario but a lot of people should be getting rich in this market, especially backgrounding calves. It might be different for many people who would have to invest in facilities but you have plenty of cattle handling facilities if I am not mistaken.
LAA Brain806 did not say anything about having cattle or the facilities to feed out his corn of soybeans.
Also the dollars involved in finishing cattle right now are staggering. The high cost of the feeder cattle is knocking most of the extra profit out of fat cattle right now. Guys are making maybe $250 instead of $150 per head but are handling 50% more dollars with the extra risk involved.
Brian806 is talking about another 100 acres of corn. That would take around 180 feeder cattle to use the entire corn crop on that 100 acres. The cost of 180 feeder cattle right now would be around $225,000. I seriously doubt he has that kind of money or even the ability to borrow that much money.
The sad part about just about any farming these days it that it takes large amounts of money to operate a farm of any size at all. A part time farmer with 250 acres of grain can easily have over $175,000 in operating costs.
Also the dollars involved in finishing cattle right now are staggering. The high cost of the feeder cattle is knocking most of the extra profit out of fat cattle right now. Guys are making maybe $250 instead of $150 per head but are handling 50% more dollars with the extra risk involved.
Brian806 is talking about another 100 acres of corn. That would take around 180 feeder cattle to use the entire corn crop on that 100 acres. The cost of 180 feeder cattle right now would be around $225,000. I seriously doubt he has that kind of money or even the ability to borrow that much money.
The sad part about just about any farming these days it that it takes large amounts of money to operate a farm of any size at all. A part time farmer with 250 acres of grain can easily have over $175,000 in operating costs.
I did not say anyhting about Brian806 feeding his corn to cattle, I asked you why you are selling corn instead of feeding it to cattle?. I did not even specify fat cattle, the money in the last 15 - 18 months has been made turning 3 and 4 weight calves into 8 weight calves and feeding cull cows, but only if a person had the feed or pasture or a cheap source of same. Usually you read the post before you respond.
Kent Petersen
Well-known Member
come on guys the only people that i know that can out cry a farmer are school teachers. i farmed 18 years and made a little every year
2 Old 2 care
Member
You got in the game at the worst possible time....when prices were HIGH. Now you probably thing that is normal. Cash grain farming is like playing the stock market in many ways. You have highs and you have lows. You have to look at long term numbers to get a real picture of how you're doing to say if it's profit or loss.
Fact is, dang near ANYONE could make money with $8 corn. There are but a hand full that can turn a profit @ $3.50 or $4.00. There are "BTO's" that make money @ $low prices, there are BTO's that lose the shirt off their backs. Same applies equally to small operators. Long and short of that, there are both big AND small guys who are sharp businessmen....There are both big and small who are just stumbling along, fooling themselves but no one else.
Farming is a long term commitment. (of which, may be proof one needs to be committed)
Fact is, dang near ANYONE could make money with $8 corn. There are but a hand full that can turn a profit @ $3.50 or $4.00. There are "BTO's" that make money @ $low prices, there are BTO's that lose the shirt off their backs. Same applies equally to small operators. Long and short of that, there are both big AND small guys who are sharp businessmen....There are both big and small who are just stumbling along, fooling themselves but no one else.
Farming is a long term commitment. (of which, may be proof one needs to be committed)
GeneMO
Well-known Member
- Location
- Pilot Grove, Mo.
Got myself a really good job in 1985. Dad sold most of the bigger farm equipment in 1996 and hobby farmed, share cropped out the row crop land. I joked that the less I farmed the more money I made.
I retired in 2013 at age 58. Really though, I hated to quit farming but had some health issues.
At least you can say you were your own boss.
On a small acreage anymore, the niche farmers, who do non-GMO/Organic and sell direct through farmers Markets or to high end resturants are the way to go.
Small farmer hasn't got much business in todays environment. Unless it's all paid for and you are just tinkering around.
Gene
I retired in 2013 at age 58. Really though, I hated to quit farming but had some health issues.
At least you can say you were your own boss.
On a small acreage anymore, the niche farmers, who do non-GMO/Organic and sell direct through farmers Markets or to high end resturants are the way to go.
Small farmer hasn't got much business in todays environment. Unless it's all paid for and you are just tinkering around.
Gene
LAA I just assumed you where responding to Brian's post.
We have all our yards FULL of cattle. Even with that we can only feed about 1/3 of the corn we produce. Well I should say the boys can't. I usually feed 75% of my corn.
The pasture we have has my brood cows using it. You can't jump in and out with them.
The boys will be able to make a profit in the next few years. They are doing things that many are not:
1) They do not have a single acre rented for anyway near the $500/acre some of the locals are giving.
2) While they have good equipment none if it has been boughten new. Most of it needed work to make it into good equipment.
3) They are hedging the price of the corn they will produce. They have a solid floor under their corn with cash contracts coupled with options to protect them if the market swings wildly either way. They will not hit the very high prices but they will not hit the very bottom either.
4) They are not just starting out either. There are few ways to work into farming these days without outside help. That can be your family that farms helping or a good outside job helping the cash flow.
Are you completely new to the cash crop game?
Here is what you need to survive...
-An elevator within reasonable driving distance. Anything other
than that will cost extra.
-Your own trucks to get the grain from the field to the elevator.
-Your own bins to store the grain from the time it comes from
the field, to when it is sold.
-A large bank account to carry you through any problems.
If you lack any of those things, you will loose money. If you have all those things, you make money every year, almost.
Let's break it down.
If you have to take your grain long distances to get your grain to market, it costs a lot of money. As the price goes down, the percentage of profit going towards transportation increases.
If you have to pay jim bob and billly bob to take his truck from your farm to the elevator, you will pay for his time and hs expenses. If you had your own trucks,you just pay for ownership expenses, but not jim bob billy bob's time to drive the grain.
If you are selling all your grain at harvest, you are really just feeding the beast. You need a place to hold your grain so that when you harvest it, you can hold onto it. Being in control of when it is sold is being in control of the price you sell it. This can gain you 10-50 cents per bushel in as little as 6 months time. This can gain you as much as $1.50 per bushel in the same time frame depending on the markets. It could also bite you square on the rear in the same time, if you are not savvy to the markets. Refer to the Kenny Rogers song, "The Gambler."
If you hit a few years when the price of grain does not cover the cost of production, you need to have money to live on. Refer to the grain markets in the past, where corn prices wee so darn bad, the cost to produce meant breaking even, except for a government subsidy on the grain. That doesn't happen now. It is gone. So... In order to make money, you need to invest in crop insurance that hedges you against the price. (That is a drawback of the new farm bill. Now they call it "insurance" and you have to pay for the hedge.) That is the "expected price" protection. For anything else, you need to follow the markets and trends. Plant crops that aren't in the main stream of things, figure a way to market them, and go from there. Some people call it a "niche."
There are 80,000 seeds in a unit bag. Assume it is the same with sweet corn. Right now, I see hot houses that sell a 3 inch pot with 2 sweet corn plants for $4.10. So, by my math, an 80,000 seed bag is worth about $164,000 if you can sell each individual corn stalk. Yeah... see how a niche can make a farm?
That is what you need to find. You need a niche. When you find one, you can continue. If you keep up on what you are doing, refer to the rest of the advice I have given. I won't steer you wrong. I promise.
Good luck. Farming needs young guys. A mojo shift in farming is coming. I just hope that more of us young guys can afford to take over for the generation that is passing. Average age of a farmer is now 60. They are going to pass sooner than later. Young farmers need to be in a position to take over. If you can't do that, you need to stop focusing on which tractor to use when you wake up, and focus more on what land is heading for a sale or a retirement. You need to be a shark. Having a large bank account(refer to above) really helps in this case. You need everything you can get.
Follow my advice, and you won't be a millionaire, but you will eat good and have a happy life.
God Bless
Here is what you need to survive...
-An elevator within reasonable driving distance. Anything other
than that will cost extra.
-Your own trucks to get the grain from the field to the elevator.
-Your own bins to store the grain from the time it comes from
the field, to when it is sold.
-A large bank account to carry you through any problems.
If you lack any of those things, you will loose money. If you have all those things, you make money every year, almost.
Let's break it down.
If you have to take your grain long distances to get your grain to market, it costs a lot of money. As the price goes down, the percentage of profit going towards transportation increases.
If you have to pay jim bob and billly bob to take his truck from your farm to the elevator, you will pay for his time and hs expenses. If you had your own trucks,you just pay for ownership expenses, but not jim bob billy bob's time to drive the grain.
If you are selling all your grain at harvest, you are really just feeding the beast. You need a place to hold your grain so that when you harvest it, you can hold onto it. Being in control of when it is sold is being in control of the price you sell it. This can gain you 10-50 cents per bushel in as little as 6 months time. This can gain you as much as $1.50 per bushel in the same time frame depending on the markets. It could also bite you square on the rear in the same time, if you are not savvy to the markets. Refer to the Kenny Rogers song, "The Gambler."
If you hit a few years when the price of grain does not cover the cost of production, you need to have money to live on. Refer to the grain markets in the past, where corn prices wee so darn bad, the cost to produce meant breaking even, except for a government subsidy on the grain. That doesn't happen now. It is gone. So... In order to make money, you need to invest in crop insurance that hedges you against the price. (That is a drawback of the new farm bill. Now they call it "insurance" and you have to pay for the hedge.) That is the "expected price" protection. For anything else, you need to follow the markets and trends. Plant crops that aren't in the main stream of things, figure a way to market them, and go from there. Some people call it a "niche."
There are 80,000 seeds in a unit bag. Assume it is the same with sweet corn. Right now, I see hot houses that sell a 3 inch pot with 2 sweet corn plants for $4.10. So, by my math, an 80,000 seed bag is worth about $164,000 if you can sell each individual corn stalk. Yeah... see how a niche can make a farm?
That is what you need to find. You need a niche. When you find one, you can continue. If you keep up on what you are doing, refer to the rest of the advice I have given. I won't steer you wrong. I promise.
Good luck. Farming needs young guys. A mojo shift in farming is coming. I just hope that more of us young guys can afford to take over for the generation that is passing. Average age of a farmer is now 60. They are going to pass sooner than later. Young farmers need to be in a position to take over. If you can't do that, you need to stop focusing on which tractor to use when you wake up, and focus more on what land is heading for a sale or a retirement. You need to be a shark. Having a large bank account(refer to above) really helps in this case. You need everything you can get.
Follow my advice, and you won't be a millionaire, but you will eat good and have a happy life.
God Bless
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