A good plan?

[cowman]

Last night my cousin came over and he told me what he was planning to do. I think he has a pretty good plan.
He farms about 1000 acres and has 150 cow/calf. He intends to phase out the cow calf end of it slowly. Keep no replacements and sell off the cows as they get too old or don't produce. Keep breaking up the land as the cows diminish. He figures there is only one quarter that isn't fit to farm and he thinks he can probably sell it over the next few years for a good price and maybe replace it with a better quarter.
I thought this sounded like a pretty good way to do things and I asked him if he would like some more land to rent(he rents 250 acres from me). He was all for it so I think I'll go for it. I believe most of my land could be broke but definitely not all of it, but I could run a few grass steers on the remainder.
I wonder though how many more people might be thinking along these lines? And whether we will then have a glut of grain on our hands?

[countryguy]

Do you rally think this is such a good plan Cowman?It will definitely be good for you but for your cousin I'm not so sure.

I think in this day in age diversification is the key to survival.This has been proven with the Bse crisis in the cattle business,the pork sector,the bison and elk industry and on an on.Like I said in another room I've seen alot of large grain farms fail already simply due to one yaer of bad weather where as a diversified farm may have been able to keep going.

Aside from adding some non farm type enterprises to our farm I don't know what else we could do to diversify any more and I personally wouldn't have it any other way.

Cattle when used as a tool can really work well with a grain farm to cut costs on the grain side increasing the profitabiliy of the whole farm.

[grassmarketeer]

Very few people out here in East central Ab have been thinking that way. Most just want to know how to get grass established under drought and hoppers. I on the other hand am just about being forced to put land back into production for cash crops. My hayland coverage has consistently diminished under AFSC. AFSC has opted not to insure pasture. I am left with the decision to stay in Cow/calf with no production coverage and the hayland getting older and rougher and trusting CAIS to cover my backside, or switch back to grain farming until the economics change in ranching. What the gov't doesn't realize is that these are all or none decisions that might effect generations to come. Oh well, I guess they are content to let Hutterites, Indians, and Life Insurance Companies own and farm the praires. I blew 35$/ac on grass seed last year and that seemed like a total wreck looking at the field last fall. I wonder if forage establishment insurance will ever come to our let's go green province.

[frustrated1]

i always thought diversification was the way to go. seed 2000 acres, have 150 bred cows, do some custom work. run old equipment and keep capital down. these past few years it has worked that i'm guaranteed to be tired and get no FIDP payments. the drought year we put up everything for silage and kept all the cows. the feed inventory killed us. this year the crop is reasonable and the cows aren't devalued in the programs until you're forced to sell so we never collected again. i don't want to farm for government programs but it seems there are a lot of guys with strictly one enterprise that are living very well off these programs with only the one job instead of three. we still make our payments but i have to ask: is diversification the key or are we just getting old and tired?

[carebear300]

Grassmarketer don't get to down in the dumps about that grass seed. patience is something that is likely required. In my exsdperience only about a third of the seed germinates in the first years anyways, it is a miracle at might place if there is anymore than that, so you just might be surprised what will crop up there this year with a little bit of moisture. More land seeded to grass has been reseeded, just because guys got to rammy.

[StrawBoss]

It seems we are too eager to change our ways as soon as something good or bad happens.
When thing are good we start to expand with no rhyme or reason and when things go bad make panic decisions with no plan for the future.

My neighbour was farming about 2500 acres and had a cow/calve operation with 250 cows and a few years ago told me he was thinking of expanding his herd, and quitting grain farming because there was more money in cattle. He wanted my opinion and the answer I gave him was, “ I like to sit on the fence and be able to look in both direction now maybe give that a thought.”

He didn’t expand the herd, also didn’t cull his cows on a regular bases, and did cut back on grain farming. I hope he survives this BSE problem.

I think testing all cattle for BSE should be started without delay, before more beefeaters get hooked on chicken and pork.
There is a good future for the beef industry but lets start looking after the customers and give them what they want. Trying to pull the wool over their eyes is sure to backfire.

[cowman]

Well Strawboss, testing isn't going to happen...Neil Janke said so! And he probably got that right from his bosses mouth! But its a nice thought.
For me making a decision to get out of cattle isn't a big deal. I've become discouraged over the years with the cattle business. Didn't start with BSE but probably the tough winter of 95-96. Also I could see every man and his dog getting into it whether they made money or not. I sure wish our politicians had stood up a little more for our grainfarmers...then maybe we wouldn't of had so many Johnny come latelies in the cow business!
But everything changes and there is always a time when things come to an end. We all have to do what works best for us. My cousin is still fairly young. He has a young family and he wants some spare time to be with them. He figures if he gets rid of the cows he will eliminate about two thirds of the work. And in reality grain farming can be fairly enjoyable? A month in the spring, a month in the fall and the summer and winter off! He is making money at it and he has no debt(a couple of oil wells help).

[Horse]

Cowman you just said what I have been saying for a long time there are to many in the cattle buisness that dont belong those that have a tax problem from high wages those with oil revenue from leases that are forced to keep cows to keep thier oil $. Mabey it is time for the govmt to plug some of the loop holes in the tax and change the leases mabey admit what they are and quit forcing them to own cows to keep thier money coming. Sure is tough to compete when the compitition only pays 10$ for 5 mo pasture .
know I keep on harping about leases but they are my largest competator .

[dfarms11]

frustrated1, THANK YOU!!! I'm not the only one feelling ripped off by gov't programs like FIDP.

[cowman]

Horse: Maybe those guys with the $10 grazing bill will be the only ones that will survive? I find it amazing that people can say they can make it with $1/lb. calves and 12 cent cows or 30 bu./acre barley? I realize they might have some pretty cheap inputs but you still need to pay the power/gas bill and buy some machinery. And even on cheap land there are things like taxes and insurance. I always thought I was fairly tight and efficient but I guess there is no way I can compete. Better to give it up and let these farmers who can operate on a shoe string have these low markets?

[lornej]

Don't get too discouraged cowman - remember when you were young and foolish and had lots of ambition , you just put your head down and moved forward - nothing could stop you ! Besides you probably didn't own anything so had nothing to lose . As we get a little long in the tooth we start to realize that we have built something over the years that has value and we get to be a little reflective and concerned that it could all be for not if we get a few bad years in a row . My advice - rent the whole damned place to your cousin , maybe sell a couple of quarters and do some of the things you always wished you had time for - remember , there is no reason to feel guilty for quitting with some money in the bank - the other alternative of course is to keep procrastinating and farm until its all gone !

[frustrated1]

lornej: thanks. think you hit square on the head what's been bugging me the most. used to be damn the torpedos, if everyone's doing it, we'll do the opposite, gamble, what do we have to lose? it's worked well and put us in a reasonable position. now we've got something to lose and through no fault of our own may be closer to losing it than we ever have been. never pulled in the reins before. now i find myself in some very unfamiliar territory trying to see where the herd went. i really hate second guessing myself. my worst fear is to screw up so bad i have to go get a real job. or do i put my head down and charge again............??

[countryguy]

Don't give up now boys! You've come this far and worked too hard to throw in the towel now! Only the strong will survive.

Believe it or not there are good times ahead for farmers.World grain stocks are at bin bottoms and can tolerate no glitches in production anywhere in the world.The US cattle stocks are at 50 year lows.Surely at some point here they'll want and need our cattle again and if that border does happen to open watch the prices soar on all those cattle in your pens!

Whoever has made it this far in this business deserves a huge pat on the back.We just have to endure this little glitch just like we have taken all the other ones in the past.Now get those chins up and put that smile back on your faces.

[pandiana]

I can't help but wonder how the killing of billions of chickens, ducks etc. will impact on the global meat market. Will this directly affect our chicken sales,..pork? The need for high protein meat products isn't going to go away.

[Smithy]

Thanks for the pep talk countryguy...I think we all needed it.
Between drought and bse the last year or so has been discouraging but there is a big hungry world out there and beef is a pretty tasty source of protein.