Making your own hay not profitable

[cowboydoc]

A new 10 year study Texas Coop Extension study shows that in order to even break even producing your own hay versus buying hay you need to have at least 150 head of cattle and produce over 310 tons of hay per year. At that production level you are only breaking even. Anything less than that and you are losing money. They also stated that this was assuming you had a perfect year every year and did not lose product to diseases, drought, rain, etc. They stated you were much better off to buy hay, pasture existing fields, extend grazing, and use rotational grazing.

 

[tough451]

I can buy some of that theory but it does not seem logical unless your small like me. I plan on carrying 12 to 15 head of Brood cows on my 45 acres and but buy my hay as the expense of the hay equipment would be to great. I could run stockers but there is somthing about watching those baby Angus grow.
What do you think coming from a much larger scale.

 

[jwcinpk]

I'd agree! I wonder if they took into acount the tax breaks? I basically farm my dad a tax break. I figure I have 40k in my equipment and get about $10 profit or use from each roll I roll at that rate it would take me 4000 rolls to just break even. Basically 10 yrs and then all I'll have is worn out equipment and skin cancer.

 

[EastTexFrank]

This doesn't surprise me. The cost of haying equipment alone makes it prohibitive for small farmers to cut and bale their own hay. We have ours baled on a cost plus share basis. The only thing that makes it worthwhile is the convenience. We don't have to locate, test, load and have delivered the 100 (approx) big bales we need every year. Let's see now .... that'll cost about $2500 @ $25/bale (guess) and that's probably less than we spend on spraying, fertilizing, maintenance and cutting, without equipment and my labor cost, so you're right ... we're losing money. Still, there aren't many people who live on a small farm in order to get rich and as someone else said, "It's nice to watch those little ones grow". /forums/images/graemlins/smirk.gif /forums/images/graemlins/smirk.gif /forums/images/graemlins/smirk.gif

 

[higgy]

Depends on how you buy your equipment. I bought a IH 275 windrower in great shape for $400.00 and put 30.00 in parts. My bailer is a new holland 283 which was totaly rebuilt for $1000.00 and I bout a JD side deliver rake for $75.00. I already had the tractor.

So for $1505.00 I am making hay. If the machinery is kept up it will not cost me a great deal to make hay for my livestock. Will I make money, no will it help to demonstrate ag useage of the land and equipment and help maintain the my tax base as ag yes, does it lower the overall cost of feeding, ahhh maybe a little tiny bit.

Do I enjoy it, heck yes I get lots of seat time and I quite frankly love it.

If nothing else do it for the fun and enjoyment.

Dane

 

[HayDR]

#1- Texas is not the whole world over half of Texas receives less than 25" of rain a year.
#2- That is the same government that said that a Bumble bee could not Fly.
#3 Over half the cattle owned in the USA are owned by people that own or farm less than 150 acres so that means that all of those people can not make any money. How false can that be?
#4- Most land east of the Miss. River has on average 37" or more a year and will become a jungle in short time if left fallow or un-kept. Having a cow calf operation is the cheapest way to keep the land on an appreciating course of value.

 

[Woodbeef]

Dang now,if I'm not making any money in the hay business where is that money coming from that I deposit into my bank account every year ?

 

[tough451]

True so True.

 

[cowboydoc]

#1 where this study was done they recieved 34" of rain/year and were producing 8.16 tons/year off of the ground. Pretty dang good yields.

The equipment was not based on new equpment. It was based on what the average person had. That factored in an average of new, old, etc. equipment.

Fertilizer, fuel, labor, repairs and maint., and land costs were the biggest costs.

This study included a five state region as well to include Texas, Oklahoma, New Mexico, Kansas, and Missouri.

The national average cost to produce a ton of hay was $66.67 when all costs were figured in. The average cost nationwide to buy hay was $63/ton.

The costs per ton were as follows:

Labor $21.
Chemicals .91
Fertilizer $5.79
Supplies $2.45
Depreciation $5.47
Fuel $3.47
Repairs and Maint. $6.32
Land $20.14

 

[Lenarguy]

One could argue labor, small farming I haven't made any money. If I already own the land and it is just sitting there, then I wouldn't count it. That makes it about $40 less per ton, or about $22 per ton, which I would say is about right.
If you buy hay in any quantity you are at the mercy of the market. High price, you pay, low supply, well you might have trouble finding it and if you could you would pay a higher price. I personally like to control my own hay market as much as I can. I think for some people buying it is the best way to go.
Here in western PA. you can find good old square balers for $500 or less, mowing machines, crimpers and rakes at $50 to $300 apiece. This makes the machinery fairly cheap.
Different ways of operatiing your farm are up to the individual and their preferences. I think you made a good point and this certainly gives us something to think about and that is a good thing! Thank you for sharing that study!