First, do you want to own a ranch or do you just want to be in the cattle business? Did you know that you can enter the cattle business without owning either land or cattle?
“Waiting for a Chinnook” Also known as “Last of the 5000”
You are already thinking, “This guy has lost his mind!” But seriously, you can. You can lease land and take in pasture cattle–i.e. you can pasture someone else’s cattle on leased land for a monthly per head fee. Once you get a reputation for paying your bills and taking good care of other peoples land, ranch lease opportunities will come to you. You won’t have to look for them.
This is an excellent way for young prospective ranchers to get into the business without having to…
For some reason, farmers of old (and, sadly, probably some still) thought that throwing old metal farm implements, myriads of rolls of barbed wire or woven wire in ditches, along with old hedge posts would somehow magically make the ditch stop washing. Nothing could be further from the truth! However, it could be said that throwing trash in the ditch answers men’s idea of ‘cleaning’ sort of the ‘out of sight, out of mind’ that women simply cannot fathom. It’s still there for goodness sake!
Blessed with incredibly fine weather and a wee bit of time and some great help last week and after owning this property for about 26 years, this 50 foot stretch of ditch had the metal pulled out. Because of the junk, the water simply pools and won’t allow healing. Once I graze the pasture down this winter with my cows, I’ll burn all the wood trash and cut down as many rubbish trees as necessary to allow this ditch/draw to grass over and heal, so erosion will STOP!
What a surprise to find these fine implements stacked alongside the ditch – most are in decent working order, though too antiquated to be useful except as yard ornaments.
One of the best environmental activities the federal government could assist, if it must assist, is providing a short term subsidy for scrap metal. This one thing could clean up farms, ranches, dead car lots, any scrap metal lying around. Generations of farm rubbish has been thrown in ditches and draws and would be cleaned up and turned into cash. Win – win for environment and farmers, but not the third win for new metal producers: they would take a short term hit in sales that would definitely hurt.
However, for the past several years, scrap metal prices have moved between 2 cents a pound to its current 4 cents a pound here locally. ($80/ton) Clearly not enough to make it worthwhile to load it, strap it down securely, drive 30 minutes to the nearest facilty, then unload it by hand as well.
With the first pass May 15, 16, and 17 behind me, several very light rain showers, and a few days of drying out, I was ready to get to that second tillage pass and get the annual seeds in the dirt!. Thursday, May 25, 2017, I spent 4 hours with the Howard Rotavator 600 and was pleasantly surprised that, for the most part, the John Deere 4250 tractor worked along nicely at A2 speed vs A1. This effectively increased my speed from 2.1 mph to 2.6 mph. And it showed up in the final tally for sure! The second pass on the same 18 acres, instead of taking 12 hours as before, only rang up 7 1/2 hours. Nice. Admittedly, i could never make a farmer (row cropper); how do those guys run those things for hours on end, daylight to dark, day after day. I was thankful, i could distract myself for a while, at least on the long rows, by chatting (private message) with my son, who was at a cafe in Spain, and texting about soil conditions with a friend who was farming another part of my farm with 120 acres for organic soybean production. I finished up with the second pass on the 26th. It was also seeded on the 26th.
When i was about 2/3 rds completed, Allen came with a huge bag of premixed annual seed to fill the hopper on the Einboch power seeder and harrow. He finished all 18 acres in about 4 hours, counting a couple stoppages due to hoses plugging.
So, time spent so far:
Mixing seeds – 1 hour
Tractor – first pass – 12 hours
Tractor – second pass – 7 1/2 hours
Tractor/Seeding – 4 hours
A couple of ways to figure the cost of establishment.
One is to figure my actual costs and assign an hourly rate for our time plus wear/tear/depreciation on the tractor and implements. And the other is to use custom rental rates which are figured by the acre.
Total man hours spent – 24.5 hours at $??/hr
Tractor costs for 23.5 hours at $??/hr
Fuel costs – 23.5 times 7.7 gph = 181 gallons @
Or using machinery rental rates (which is what i’m going to do since i don’t know the above costs!)
tractor and rotavator – 36 acres times $20/acre = $720.00
tractor and seeder/harrow – 18 acres times $15/acre = $270.00
Seed costs – $31.56 per acre is what i ordered – HOWEVER, i am informed that Allen actually put on about half again as much, so i will multiply that amount by 1.5 for a per acre cost of $47.34. The additional seed will hopefully pay off in increased forage yields. So total seed costs are $$852.12.
Buckwheat 6# @ $ .90/lb
Lespedeza 6# @ $1.00/lb
Pearl Millet 5# @ $1.05/lb
Oats 12# @ $ .28/lb
Cowpeas 6# @ $ .90/lb
Sunflower 5# @ $.45/lb
Red Clover 2# @ $1.95/lb
Total expenses then amount to $1842.12 or $102.34 per acre. That’s a lot and does not include the 2 tons of lime i had applied in April at a cost of $66/acre. It’s tough to say this all has to be recouped in one year or one grazing because the lime will be there for the rest of my life and the tillage will have long term effects in loosening the soil as well as eradicating the toxic endophyte infected fescue. With so many variables, counting the cost, or rather, measuring the increase or lack thereof, in the short run, is very difficult in ranch renovation.
The plan is to have something to graze in 60-75 days. This will depend large part on moisture. We are getting pretty dry now already and need a rain. I will post updates.
By the way, you noticed i’m not including costs associated with photography and blogging. It’s a good way to force me to sit down and keep a log of expenses, time, and results. Hopefully, it will help others as well!
Managing soil, water, and animals properly and privately goes a lot further than politically motivated government regulations written by people who are far removed from soil and weather.
This is a direct quote from an article I read awhile back.
“The name of an article in a non-farm magazine was “Gulf hypoxia thought to be caused by agricultural run off.” Yet this year it was 33% the predicted size and no one knows why science failed to be right.”
No, it was not that science failed to be right, it was that they guessed wrong, and that is not science. Guessing is what people who have an agenda “call” science. Science is when something is studied until they know that it is right and it can be proved. There is so much guessing about things in the future that to try and make the guessing legitimate they call it science, and then try to have it accepted as proven.
This is much like the livestock markets. Most people want to guess what the prices will be in the future. These guesses often fail to be right then it is blamed on something else. Always deal with real things not guesses or hopes. The things that are real are today’s prices not what they may be in the future. There is one thing about today’s prices, they are easy to prove. That must be very scientific. It will be very hard to prove that prices in the future are right until we get there, that must not be very scientific.
Bud Williams died a few years ago, but his thoughts, videos, and stockmanship teachings are kept available by his wife and daughter at stockmanship.com. There is a massive amount of information necessary for becoming competent and improving at developing relationships with animals and people.
Dave Pratt, owner of Ranch Management Consultants (formerly known as Ranching for Profit) hits it on the head again with another great blog entry. Although his niche is specifically ranching, the ideas he shares are often for any business.
I occasionally lead workshops I call Hard Work and Harmony: Effective Relationships In Family Businesses. In it I like to ask participants to explain to the person next to them why they ranch. Some say they love being their own boss, or love working outdoors and with livestock. Almost all of them say something about loving the lifestyle. Near the top of most people’s lists is, “It’s a great place to raise a family.”
I agree. I grew up on a small place. The biology lessons I learned from tending livestock were more influential than any I ever had in a classroom. I learned other lessons too. I learned how to work hard and how to be resourceful. But it wasn’t just about work. Our place was a great setting for any adventure my imagination could conjure up. My mom sold it when I was in college and it just about broke my heart.
A ranch can be a great place to raise a family, but it isn’t always. I worked with a rancher shortly after my son, Jack, was born. When we broke for lunch he asked about my new baby. I told him that when they placed Jack in Kathy’s arms for the first time, I could hardly see him for the tears of joy streaming down my face. Tears welled up in his eyes too, but they weren’t tears of joy. Trying to hold back a flood of emotion, he told me how he had worked sun up to sun down to build a place “for the generations to come.” He said that he hadn’t been as involved in his children’s lives as he should have been. As we sat on the hill, he told me that now he rarely hears from his adult children, who want no part of the ranch. A ranch can be a great place to raise a family, but it is not a substitute for our active involvement in family life.
Many ranchers are addicted to work. I’ll bet you’ve even heard some of your colleagues brag about how long and hard they work, proudly proclaiming things like, “I haven’t taken a vacation in 20 years.” They say it as though it is something to be proud of. When I hear things like that I shake my head wondering, “Are things that bad?” You can’t run a sustainable business on unsustainable effort.
Intentional or not, work can become an excuse to avoid working through the issues every healthy family faces at one point or another. When work consistently takes precedence over family needs, we set ourselves and our families up for trouble. Engaging in what may be uncomfortable conversations when issues first come up can keep them from growing into big problems.
In the last few months I’ve met a number of people who are learning that lesson the hard way. After decades of avoiding uncomfortable family issues they are facing extremely difficult challenges regarding succession. Now, without any experience working with one another to resolve small issues, they are hoping to work through the most difficult challenges many of us will ever face. The conversations are made even more difficult because of the hurts that have gone untended and the resentments that have grown from not taking care of the family in the family business. It’s a tough way to learn that success has more to do with healthy relationships than with conception rates and balance sheets.
I don’t mean to suggest that the physically demanding work that ranches require can be ignored, but it doesn’t have to be all consuming. Many Ranching For Profit School alumni have discovered that the ranch was all consuming only because they allowed it to be that way. After the school they restructured the business to increase profit and liberate their time to put more life in their work/life balance. They still work as hard as anyone, just not as long. Their ranches are great places to raise their families, andthey actually take the time and make the effort to be directly involved in raising them.
To hear how one RFP alumnus decreased the work required to run their ranch while increasing profit and improving their quality of life, click here.
Most people blame things beyond our control like the weather, government regulation, low commodity prices and increasing costs for their failure to make a healthy profit. These are the things most often discussed at producer meetings and in the coffee shop. These are also things we can do little about. Making them the scapegoats for poor performance makes it easy to absolve ourselves of responsibility. But if prices, costs, weather and regulation really determine profit or loss, why do some businesses survive, even thrive, in these conditions while others fail? Depressed markets are a crisis for some but a profitable opportunity for others. It is not the situation, but the decisions we make that determine success or failure.
According to the US Small Business Administration, most new businesses fail. Fewer than 10% survive to see their 10th year. In his best-selling book, The E-myth Revisited, Michael Gerber points to an exception. He says that 97% of new franchises survive beyond 10 years. Why the difference? Simply put, franchises have a clear-cut blueprint on how to run a business. McDonalds doesn’t succeed because they make the best hamburgers or because they hire the smartest, talented people to work behind the counter. Over the years they have achieved economies of scale and have a lot of clout when it comes to negotiating lower costs with their suppliers. But they wouldn’t have been in the position to do that if they hadn’t built a business that actually works. They didn’t grow first and then figure it out. They figured it out and then they grew.
As Gerber puts it, they worked on the business (WOTB) to build a business that actually works. We are so busy working in the businesses (WITB) doing $10/hour jobs that we often don’t ever get around to working on our businesses (the $100/hour work). This is the work that determines the winners and the losers in any business…including yours. More than genetics, prices, weather or any other factor, it is this issue that separates the men (and women) from the boys
(and girls) in ranching.
Our ranches suffer economically, financially and ecologically when WOTB takes a back seat to WITB. Our failure to effectively work on our businesses is the single biggest reason that most ranches aren’t profitable and that most ranches don’t survive generational succession with their land or family intact.
It doesn’t have to be this way. Ranching can make a healthy profit, thrive ecologically, stay in the family indefinitely and be the stimulus for revitalizing rural communities. You put your ranch on the path to achieve these results when you put the shovel down and pick up the pencil … when you start working on it, not just in it.
I’ve heard some complain that they don’t like working on their business. I wonder if the real problem is that they don’t know how to work on it. Previous generations may have been able to get by without WOTB when land values were cheaper and their ranch had only been split once by a generational transfer. But times and conditions have changed. What passed for management then, doesn’t pass muster now.
Score yourself to see how effectively you are working on your business:
Scoring: 0 = I have not addressed this issue
5 = I have addressed the issue but have more work to do
10 = This describes my business.
If you scored more than 70, congratulations! You probably have a healthy business with a promising future. If you scored 40 to 70, you’ll be feeling the pinch but will probably continue to get by with off-farm income subsidizing the place … at least until it comes time to pass the ranch on to the next generation. If you scored less than 40, you might want to think about going to work as a cowboy for someone else. If you want a good job, I suggest you hire on with someone who scored more than 60. He’s the one who’s Ranching For Profit.
Be sure to check out Dave Pratt’s Ranching for Profit website for more information and to see if his week long school would be something that will help your business!