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Snapshot of the Industry

B

burnt

Well-known member
Joined
Feb 28, 2008
Messages
6,617
Location
Mid-western Ontario
I am interested in learning how many of the people on this site are making their livelihood entirely from the farm or ranch. We have seen a lot of good people leave the industry in the past couple of years and I may be the next one because I cannot see my way clear to run even a small cow/calf farm like ours in addition to going off-farm to earn the capital to make a living.

I'm not sure how to set up a meaningful comparison but how do you think the following work for a sort-of poll? It would break into categories our various operations by herd size and thus hopefully show where how many cows it would take to provide a livelihood from raising calves.

If this formula would be considered workable, it could then be transferred into a poll form in order to maintain confidentiality. I do not think it would be wise to say "I am so and so and I have x0000 cows and . . . .

Such a survey is obviously not comprehensive and cannot take into account many important details like retailing your product, which many of the smaller operators do, but if anyone wants to add to the thread the details of their operation they may do so. It obviously also fails to leave room for the bigger and biggest outfits, but if one cannot make a living on over 500 cows, where is this industry headed?

How does this look for a survey to be placed in a poll thread? Are the category numbers too small or tight? Your input is welcome.

Category 1 - less than 100, no off-farm income.

Cat. 2 - less than 100, with off-farm income

Cat. 3 -100 -200, no off farm income

Cat. 4 -100 - 200, with off farm income

Cat. 5 - 200 - 300, no off-farm income

Cat. 6 - 200 - 300, with off farm income

Cat. 7 - 300 - 500, no off-farm income

Cat. 8 - 300 - 500 with off-farm income

Cat. 9 - over 500, no off-farm income

Cat. 10 - over 500, with off-farm income.
 
You need some sort of mixed farm category unless pulse and grain farming are considered off farm income
 
I don't want to hi-jack your thread, but a lot comes to mind when I think about making a living entirely from the farm and ranch.
First I can't stand it when anybody especially non-agriculture people ask how many cows I have. The locals can figure it out.
Second, everybody's situation is so different. I farm and ranch and my wife works off the farm. We have more than one family on the place, each family has off farm income.
Some peoples places were handed to them on a silver platter. Some have oil, gas or even gravel. (thats off farm Income). Some earned money it the old fashioned way and married it.
Any young person that wants to get into Agriculture or wants to expand from 200hd to 400hd for example. Will have a tough row to hoe. I think every generation has had its challenges in Agriculture. I don't think the economy of scale (big operation) is unique to agriculture.
 
The point of putting it in an anonymous survey/poll form would be for the exact reason you gave - nobody needs to know how many cows anyone else owns or runs.

However, for reasons such as have already been given, the problem of variability in operations is too great to incorporate into a survey that I would like to try to put together. So it does not look like it would be a meaningful effort.

But perhaps there could at least be some discussion about the question of scale, with cows exclusively or in mixed operations.
 
The thing is that the off farm income can be misleading here in the states in comparison to Canada- because many of the farmers/ranchers either have off farm jobs- or in most cases their wives work off farm in order to get health/medical insurance...

Folks with 500-1000- I even knew one that was in a 10,000+ head partnership, who's wives worked off farm so that they could get and keep a family health care plan.....
 
My wife and I work full time in this business, but not all that this business does is Agriculture. The ranch and farm are the steady base and then there is layering of enterprises on top. Very hard to quantify but if only cows were the income it would take at least 500 in a cow calf configuration to make a living for 1 family IMO. (penciled it out many times) However, there could be less cows if... yearling, backgrounders, feedlot, grassfat to plate. Your imagination is the limiting factor. My grandfather used to hold up his hands and say you can only make so much with these and if you are going to limit yourself to that then you should work for someone else in their vision.
 
I hear where you're coming from Burnt, but it is tough to do a poll like this when there's absolutely no way to compare apples to apples. Every ranch has different obstacles, and although we all share the same limiting factors - weather, packer control, industry BS - it's al about how we deal with them that makes us different and unique.

My 2 cents worth, there is very, very little money to be made just selling weaned calves at an auction barn. If you're not differentiating your product, you had better be really big, and be good with margins.

We direct market grass-finished beef, sell purebred breeding stock, are opening a store in town, and I work off-farm part time as a Livestock Inspector. We're also doing other things on the farm, as other enterprises, and that will probably always happen for us. An entrepreneurial thing I guess.
 
Tough one. I don't make 100% of my living from the farm. I do make 100% of my living from agriculture. My wife also has professional training and works off farm in a non agricultural field.
My off farm work aned connections made have made our farm a lot stronger than if I just knuckled down and stayed home. My math on a straight commodity cattle operation is that I would need 1000 - 1500 cows and no hired help.
I think the challenge of defining a cattle operation is that the "job" and the "business" are totally different things. Our small operation is profitable and is a good business, but so are my other "businesses".
It also boils down to what you want to do with your time. There is no way our number of cows should occupy even 40 hours a week every week of the year. To justify spending that amount of time, I would have to have a lot more cows than I do.
 
You also have people here who only work on a "farm" they dont own one yet so do you include them? Or are we just the hired hand :wink:
I make 100% on a farm
 
RSL, no lease revenue? I wonder how to consider passive income of any sort, oil lease, mineral lease, power lines, dividends, pensions, etc. McSage, 100% is 100% unless your wife works out of Agriculture. I think this is a worthwhile discussion Burnt.
 
Well it is a topic that I find both troubling and intriguing. I lament the fact that there does not seem to be a way to make a living solely from producing food unless one goes into a mega-scale, and that even seems to be a tenuous living at times.

That, to me, is deplorable, because it seems wrong that we work hard and with great investment in many and all forms to produce food for the nations tables, and yet have to work off-farm to put groceries on our own shelves . . . .

Is there not something wrong with that or am I just a bit naive?
 
Something I would like to add to this topic of on farm-off farm income, is the inclusion of future generations whether it be your son and or daughter. Please don't exclude your daughter(s) from being part of the farm. This has just happened to me and it's tough to be part of a family farm for years only to have it all handed to "the son" in the family. Your daughter(s) are as much an asset as your son(s). Make plans to include ALL children in the transfer of the family farm/ranch.
 
burnt said:
Well it is a topic that I find both troubling and intriguing. I lament the fact that there does not seem to be a way to make a living solely from producing food unless one goes into a mega-scale, and that even seems to be a tenuous living at times.

That, to me, is deplorable, because it seems wrong that we work hard and with great investment in many and all forms to produce food for the nations tables, and yet have to work off-farm to put groceries on our own shelves . . . .

Is there not something wrong with that or am I just a bit naive?
Click to expand...

I guess my question is always "where does farming stop?". In the case of cattle, does a farm stop at cattle or can a farm continue to beef? Does landscape stewardship (including lease or other income) fall outside of farming? I think there are lots of examples of large scale farming that have very little to do with food, and many smaller scale ones that have much to do with food. There is also every mix in between.

I think this is a tough discussion, and it involves a lot of aspects and personal decisions and sacrifice. We don't own all of our farm as yet, but I suspect that is true of most businesses. It is also a big decision if you want to be in the food business and to what degree.

I am nearly 100% convinced at this point that cattle is not the product of our ranching operation in the future but it will be part of the mix. I think a larger part of our business will be driven by landscape stewardship, carbon credits, tourism, etc. and potentially by food in some form. Math and family goals determine most of our business decisions, however our personal philosophy and modus operandi override everything we do. I think that is true for most farmers/ranchers.

I know we need to work smarter, not harder and more importantly start to work collectively with like minded people. As stupid as it may sound I think that for most of us working harder is easier than the other two options.
 
I am nearly 100% convinced at this point that cattle is not the product of our ranching operation in the future but it will be part of the mix. I think a larger part of our business will be driven by landscape stewardship, carbon credits, tourism, etc. and potentially by food in some form. Math and family goals determine most of our business decisions, however our personal philosophy and modus operandi override everything we do. I think that is true for most farmers/ranchers.
Click to expand...

Yep-- I agree.. Outfitting and hunting have turned into a big business for many farm/ranch operations around here...
 
This has been a VERY interesting thread. Like many have said their is no definite answer. Many variables come in to play making it nearly impossible. I do know that since BSE many producers have lost equity and we are losing producers. My Dad recalls land prices and cattle prices from the 40's 50's and 60's and land has gone sky high with cattle changing very little in actual dollars and figuring inflation we are working with less the ever before.
 
Every business must constantly evaluate their products and customers. You also have to know your assets. We are always looking for ways to improve our operation thru marketing, land use, cheaper feeds, etc. We sell seedstock, direct market some beef and pigs and ag related products thru contacts with the beef industry. Our biggest assets are we live relatively close (120 miles) to some big populations, internet, and farm markets. There are plenty of ways to make it work but it all takes time, foresight, patiences, consistancy, etc. I don't think any two sitiuations are the same, they may have similar features but the imagination and ingenuity of the owner is what will make the biggest difference IMO
 
MsSage said:
You also have people here who only work on a "farm" they dont own one yet so do you include them? Or are we just the hired hand :wink:
I make 100% on a farm
Click to expand...

Your probaly the smart one. You get a garanteed profit each week no risk and time off.
 
DejaVu said:
Something I would like to add to this topic of on farm-off farm income, is the inclusion of future generations whether it be your son and or daughter. Please don't exclude your daughter(s) from being part of the farm. This has just happened to me and it's tough to be part of a family farm for years only to have it all handed to "the son" in the family. Your daughter(s) are as much an asset as your son(s). Make plans to include ALL children in the transfer of the family farm/ranch.
Click to expand...

I think this is a very important topic and deserves to be discussed much further in a thread of its own. It is two topics, really, succession planning and the main point that you make, I think, which is fairness in asset distribution or inclusion.

With the total value that most outfits carry today, it becomes a huge challenge to workably transfer assets to the next generation and also makes for some big battles over the "sharing" of wealth between siblings or close relatives.

None of this is made easier by the fact that agriculture generally provides such a low return on investment.

So DejaVu, why don't you start a thread with your questions and concerns? I think there will be a pretty good response.

And thank you to all who have replied to the questions I posed. The input so to this point is far more pertinent than running a poll or survey.
 
DejaVu, I agree with 'burnt' that you question deserves its own thread, and might complicate an already complex question of this one.

We, being the 'elder' gen. on our three gen. ranch, have worked long and hard with several experts attempting to assure EQUITABLE division of our ranch and other assets. Fair isn't necessarily really fair in these situations. One has to consider who, among the heirs, has put what into the business over time. Rarely is it solely built by the eldest gen. Too often, attempts at being 'fair' leaves it equally to all, even those who have not put anything into the business, which is definitely not fair to those heirs who have put years of labor and other work into building the business.

Hope you consider putting the inheritance question on another thread.

Best wishes, whichever way you go.

mrj
 

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