|
Earlville, NY | There are lots of reasons guys get bigger. You add a few cows to increase cash flow, then buy land to feed them, then you need bigger machinery for the extra land, add more cows to pay for that, then you need bigger heifer facilities, then more land, more cows etc. Some guys figure it's easier to get bigger than better. Some like the newest technology. Some just figure they can outlast everyone else. Certainly some do it for ego satisfaction. Many get bigger as children return to the farm.
We expanded years ago due to tired facilities, poor efficiency and being too close to floodplain. We made several more incremental additions and are at 500 cows. We have a perfect blend now of facilities, land, employees and equipment, and have been very profitable. I have no strong desire to expand, but there is pressure to buy more land before it gets bought by bigger farms from out of the area; it will never be available again in my lifetime if that happens. Then I may need more cows to pay for it. Like a dog chasing its tail.
All that helps contribute to our current oversupply and suppressed prices...another reason for some guys to just get bigger! | |
|
10 yr study on financial drivers in Dairy including herd size
