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| I didn’t know where to post this, but I figured Market Talk is as good of a place as any. I run cost analysis of every aspect of my operation each year. Every year I come up with the same answer: if I’m honest with myself, I just cannot show a profit on my cattle herd. My operation consists of 800 acres of row crop, and 400 acres of hay/pasture with between 70 and 80 pair depending on the year. I own most of the grass and pasture. When using “soft” numbers such as actual checks written for feed, replacements, vet, etc. I can tell myself the cattle make a small profit. But one I use opportunity cost of feed and depreciation on cattle as well as equipment cost, they show a tremendous loss. The corn and soybeans, even with opportunity cost and depreciation, show profits. Enough profit in fact to offset the livestock losses and show annual gains in my balance sheet. So my question is: have any of you ever reached that conclusion and gotten out of livestock? For what it’s worth, each year I enjoy cattle less and less and row crop production is my favorite part of agriculture. Thanks in advance. | |
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The economics of cow/calf and when to walk away?
