Woods county Oklahoma | iowa18 - 5/21/2014 09:25
Were doing a project. We have an ag loan for 200k. What is the best way to utilize that 200k on a livestock investment assuming we live in Iowa and have access to all feed. We also have a corn/bean operation but thats covered under a seperate part. Thoughts? can be long term or short term. Just have to be able to pay off the loan
Let me tell you a "real" life story
There was a kid that saved a few dollars and bought some cows and made some money.
Then he bought some 7-800 wt heifers and bred and calved them.
Bred them back and sold the heifers as bred with 2nd calf and made good money and kept the calves till 750# or so and sold them and made money.
Then began going around the sales and buying light weight single steers and bulls at a discount and putting 300#'s on them and making some money, all while still having the original cows.
He had money in every pocket and was the smartest son of a gun around.
Then there was some light weight long tail steers in Florida, but he had to take a whole pot load and he was short having enough money, so he sold every thing he had, even the original cows that had been paying steady every year and was still short.
So he goes to the bank and takes out a loan for the calves and operating money.
The calves come in and the wreck starts, shipping fever, pneumonia, coccidiosis, hoof rot, and you name it.
They start dropping dead here and there and he's doctoring day and night and spending a ton on medicine and loses a bunch.
The market went soft and when he sells what lived he's short paying back the loan and lost all his original investment.
Stick with what you know to begin with and learn about other opportunities as you go,
Don't take make you or break you risk
The cow/calf market is pretty solid right now and appears it's going to for few more years. If you have the resources for cow/calf I'd buy some middle aged bred cows that have a proven they can raise a calf each year.
I might try feeding a few calves as a learning experience and see if that's something to venture into later on as resources and experience increased.
Edited by Shanghai 5/21/2014 20:47
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question for project
