Business Venture

[jim]

A guy I know is trying to talk me into leasing some grazing rights with him. He needs more room for his cattle, and while I've been thinking of buying some cows, I'm not sure that now is the time. Several people have encouraged me to go for it. I'm wondering if the coming commercial land bust is going to totally wreck the economy and result in me losing everything if I do this.

Any comments?

jim

[CountryGuy]

You would own all the beef you buy, and only be leasing the grazing and water; correct?

If things went bust and the owner told you to get them off his property would you have another place to run them for a while?

IMHO, people will always need to eat including your family so I'd think the beef would have a real value assuming you can care and feed them if things meltdown. Not sure what you might get for them in such a situation but I'd think you'd be able to barter beef for things you would need.

[Anon001]

Now is as good a time as any. Why would the commercial real estate affect your leasing rights? It shouldn't.

You should also get a contract with the landowner. Usually, the renter is responsible for maintaining the fences.

If you are going to make this investment, be sure that you can afford enough cows, that can pay for all the expenses related.

One other thing that you need to make certain is that the contract is for more than a one year period. Where I was raised, contracts were always 3 to 5 year contracts.

The bad thing about not having a contract is that the owner can order you off at any time wthout notice.

Go for it. Just make sure you have an iron clad budget.... Calves paid for my farms. This one I'm on is 160 and they paid it off in 10 years. Then it was cash for the next farm.

The other thing to consider is the breed of cattle. You want a breed whose calves bring top dollar at auction..... usually a black breed or a black/white faced calf.

Another problem some "newbies" encounter is getting cattle that are not easy keepers. Some of this is breed specific. The last thing you need is to be pouring all of your future profits into cows and calves for feed.

My herd has developed into easy keepers. They require little to no feed in addition to the grass and hay, ...which brings up another point. Will you need to supply hay during the winter or during dry seasons?

Also be sure that you don't put more cows than the grass can support.

Go for it! Have fun and make money.

Paul

[cinok]

Is the land set up for cattle or do you have to get the pastures ready. Fences. ponds and do you need to reseed the pastures?