to farm or not to farm...

luckyfarmer

New User
I wanted to ask the members of this forum for an opinion as I am undecided as to what to do.

I have a job in town. I own about 200 acres of row-crop land which I am currently leasing for corn and wheat farming.

Recently, I was able to purchase a JD 5020 which I completely overhauled (engine, clutch, transmission, all the valves). The tractor works great. I also acquired a bunch of used equipment which I restored: chisel plow, disc plow, field cultivator, grain drill (only 10'), boom sprayer and fertilizer spreader, another 60hp tractor. I have been considering starting to farm the fields myself (I do have a hired hand who works with me most of the time). I have asked some people and they said that I am crazy - trying to do so with such old equipment.

I personally do not think it is so crazy. I would plan starting on about half the fields to learn the routine and paying someone to harvest the crop. I think this should bring in significantly more money than my current situation. With time, as I acquire more knowledge and hopefully some more equipment, I could expand to the other half of the land. I really like the idea and think it would be very interesting but would like to ask the other members of the forum. Am I way off base or is this a good idea? Thank you.
 
Well they are right in it is a crazy idea, but we are all crazy! LOL Not much money to be made in farming with old or
new stuff. It is your choice on that, I am happier farming. Welcome to the board.
 
Go for it your big time compared to when I
started with a d 15 and 2 x 16 . But what
does your family think ? What do you have
to lose time and money but what can you
gain money and more importantly the
satisfaction that your the boss the joy of
a job well done the feeling of
accomplishment the age of machinery doesn't
matter as much as the care of the equipment
like most on here I've seen plenty of new
equipment break down and critical times
while the older equipment keeps going and
the opposite can also happen. I now rent
all my farm but there willing to pay high
rent and I've got health issues.
My bottom line is its not what you spend
it's how much you make and also they all
said I couldn't do it and with little
support I did however guy's that had
everything given them failed . Good luck
and have fun.
 
Sounds like you have decent equipment and can keep it that way. Start farming now
while you are still able and keen, many people would be very envious of your
situation. Good luck and happy Farming! Ben.
 
"If farming were easy everybody would do it" is a common saying. ;)

I say go for it, but be aware....

Farming takes lots and lots of cash. Or credit. Pencil out what an acre of seed, fertilizer, weed control, harvest cost, taxes, is, add in your
seeding and tillage costs and thrn multiply by 200. Be sitting down when you do......

It takes some stuff being done right on time, not when you get around to it, to be a good farmer, or your yields go in the toilet.

The new machines are very expensive and sized for 2000 acre farms. The old stuff that is sized for 250 acre farms needs lots of tinkering baler
wire and luck to keep it going per season.

Hail, drought, floods, insects, all can cause your best efforts to crash.

Keep your ground fertilized. You can live off what is in the ground for a year, or three, or five. And think you are making money hand over fist....
But the bank runs dry there in the soil and your crops go real bad real fast, and then it is very very hard, expensive, and takes time to rebuild
your soils. Don't skimp on soil tests and fertility, that is the biggest issue I see with starting farmers.......

The other big issue with starting farmers is weed control. Need to kill thrm before you see them, or you lost the game.

Marketing is a third big issue. If you get 4000bu of soybeans and 18,000 bu of corn, will you be selling it at 6 and 2 dollars, or 10 and 4 dollars a
bu? Wow it is hard to do that right, and it can double or halve your income.....

Farm ecconomics suck right now, we are in a really bad time. It would be much better for your bank account to continue renting the land out!

This also makes it the best time for you to start farming on your own. It will force you to do things right and be on top of things, so if and when
good times cone in several years, you will enjoy them and understand hard times cycle back again. I feel sorry for anyone started farming 6
years ago, when we were in boom times in most areas. It is very hard for those folks to understand and weather what is coming economically.

Good luck!

Paul
 
I know this is not a straight forward decision. The points that are steering me to try and farm
myself are: I have a full time hired hand who takes care of my place,I own the land, I have some
equipment already and I enjoy the work. In my current arrangement, I pay the herbicide, fertilizer
and harvesting fees and get 1/3 profit. If I do all (except harvesting myself), why could I not get
most of the profit. I understand that I do not have the same modern machinery, but loaning 500k
to get 50k annually does not seem to make any sense to me. I am not trying to impress anyone,
and actually enjoy some of the older, less technically advanced machines. I understand that I will
not be as knowledgeable as the current farmers and thus my profit/ expense ratio will not be as
good but I am having a real difficulty understanding why I would not make close to (80%) of what
they are making. Timing wise, I would probably have a significant advantage, as I do not have to
worry about all of the other bigger fields to farm
 
Well, you own your land, that helps, and you have a job! Go farming. The advise I give you is don't give up your day job!
 
Ever watch a small child when you encourage
him to do something and they turn to you
with a big smile knowing they accomplished
something that's the pride you will feel. A
lot of people spend more time talking
themselves out of a job then just doing it
if you worked a job you will know what I
mean. Do you want to be an agribusiness
man or a farmer? There's a huge difference
when you fixed your tractor even though
there wasn't a profit in it thats a farmer.
You can never tell on markets they change
so fast . My nephew started and just milked
he did exceptionally good but he got hooked
with the wrong banker that wanted him to
have what others had more expense than he
needed and then he hit a dry year and feed
got short and he couldn't hang on but he
tried. Maybe the way to look at it is try
it for a year if nothing else you can
always rent again one other thing you can
look at if you're a good mechanic there are
a lot of good used small combines or picker
sellers out there. How's your renter would
he help you if you get in a bind? Maybe
part of the rent is he harvest and hauls
your crop.
 
I know this is not a straight forward decision. The points that are steering me to try and farm
myself are: I have a full time hired hand who takes care of my place,I own the land, I have some
equipment already and I enjoy the work. In my current arrangement, I pay the herbicide, fertilizer
and harvesting fees and get 1/3 profit. If I do all (except harvesting myself), why could I not get
most of the profit. I understand that I do not have the same modern machinery, but loaning 500k
to get 50k annually does not seem to make any sense to me. I am not trying to impress anyone,
and actually enjoy some of the older, less technically advanced machines. I understand that I will
not be as knowledgeable as the current farmers and thus my profit/ expense ratio will not be as
good but I am having a real difficulty understanding why I would not make close to (80%) of what
they are making. Timing wise, I would probably have a significant advantage, as I do not have to
worry about all of the other bigger fields to farm
 
I wouldn't necessarily call that "old equipment" to work 200 acres. The thing is,with prices as low as they are,there's a huge difference between gross income and profit. I wouldn't bet on making more working it yourself. At least for the first few years until you get your feet wet and learn what you're doing.
 
Farming is something you have to LOVE. If you don't you will hate it. If you feel the "love" deep in side you then go for it and you will get a certain type of pleasure you can not explain to others. If they have to ask you to explain it, then they would never understand it. To do something you love is priceless. Many folks work a lifetime of labor at a job and lifestyle they hate. What a blessing to do something you love. You might not make much money, and some years you loose some. Don't get crazy with credit and the day job will pull you through the loosing years.Just don't give up on the day job, or think you want to have the big shinny iron the BTOs have.
 
I'm having trouble following this....You don't currently farm but you have a hired man?
If you are only going to farm 100 acres and hire it combined why would you need any help?


For years I worked a town job with much OT and farmed 380 acres of grain practically
by myself with older machinery including a combine..Right now is a poor time to get in to
farming with low grain prices...
 
When you say you should make 80% of what the current renter does, are you considering the difference between gross and net income?

If you make 80% of their gross income, you will have a negative net income....

If you mean you plan on an 80% of net income that's ok.


You sent up a couple signals here:

Your initial motivation is money, you want to do this so you can make more.

You mention having a hired hand but your not farming.

Those two things we have seen before, and those are the folks that run into trouble farming the quickest. Just kind of warning signs, seen that, been there before, it derails more often than not.....

Not against your plan, but just being honest.

With income as your motivation, what is your farming budget? What numbers on this list are you running different to make yourself more profitable than the average farmer? You need these numbers figured out.

If you grow 100 acres of corn, you need to lay out $60,000 before you get a crop in the bin maybe? These aren't small numbers we play with any more.

(I see a lot of things that are different for me than this inflated generic budget - but then, I'm also dealing with a much lower corn price at $2.80-3 so I really need the numbers different.... $3.75 corn was a long time ago, and ARC payments are rapidly dwindling downward too.....)

Are you guessing you can make more money, or do you have a detailed budget worked out for your conditions?

Paul
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I live in a neighborhood where cash rent is $75-100 per acre...I rent mine out at the bottom end of this....This gets you 130-140 bu corn,30-35 bu soybean,50-55 bu wheat ground...This year the corn is running from 100-180 bu per acre...The weather was very fickle this year..A few got rain and lots didn't..

Most crops are now requiring constant spraying which is very expensive..There are more weedy bean fields this year than I have ever seen..Wheat and corn requires fungicides..

I'm retired and own my ground free and clear with cheap property taxes.....I ran the numbers on my 135 bu corn ground at $3 per bushel....If I were still farming I would do good to break even this year,maybe $10 per acre profit..If I had forward contracted I might have made some more profit.....Those that are good at marketing and keep their costs down will survive..
 
Try farming 40 acres of it the first year or two and see how it goes. You'll have comparatively little risk money wise and can slowly dip your feet into the pool. Plus you will make some mistakes as you learn and its easier to learn on 40 than 200. 200 is probably too much to just jump into farming part time. I started from scratch on my own and ran 40 acres starting out and slowly worked up to 150. I learned as I went. I have a family friend who farms full time and I basically sat down and he helped me with a plan and I did exactly what he recommended I do the first 2 years. Also you're going to need a good corn planter, even for just the 40 acres. Try to look for a 7000 John Deere on 30" rows as they're simple and do a good job. And make sure you have someone lined up 100% certain to custom combine for you, you don't want to get hung out to dry with a crop in the field. I love it and certainly don't regret taking the risk to jump in on my own. You only live once! Worst that can happen is you lose a little money on the 40 acres and walk away with the experience.
 
Look at it this way-some people golf,have a lake
house or spend time in a bar or casino. If I were in
your situation I would give farming a chance. Just
know that your day job might have to support your
farming hobby until you get everything figured out.
Good luck and don't give up
 
I will try and clarify. I own more than the crop land. The hired hand helps with cattle and other ranch tasks. My principal motivation is not money per se - but rather the desire to make my land as financially effective as I think is possible. I would prefer not to look back in 10 years and think that I could have done better.

I am somewhat confused by the responses thus far. Looking at the chart breakdown posted by one user: some of the main costs are rent, hired help, machinery depreciation - these are really non-issues for me. In my current arrangement I pay for fertilizer, herbicide, harvesting, others. So if you take these into account, I should be able to make a profit (I do understand that this is not going to be huge money). In my current arrangement, I have made 5K this year from over 200 acres of crops - I feel I can do better. I know the current crop prices are poor - but that means when they improve, and I know they will at some point, I should benefit more also. I feel the current situation benefits me - I am not looking to invest 500K into new equipment. I want to do things as frugally as possible.
 
If you own the 200 acres you have already jumped the biggest huddle. When you say you pay for the fertilizer,herbicide and combining I hope you are only paying for 1 third of the bill. And you ONLY get 1 third of the crop??? Renting that way around here is unheard of any more and when it was the renter paid for all of the harvesting and delivered to the local elevator. The fertilizer and herbicide you should only have to pay for 1 third. As the land owner you have full control to make the renter do what ever you want. There are several widow ladies here that have there renters mow their lawns in the summer and clear all their snow in the winter.FOR FREE![part of the deal to rent their ground and the rent is high cash rent per acre] If you want a steady known income I would cash rent it out. Half the rent do march first, second half due November 1st.Advertise your land for rent and you will be surprised how much its worth.Personally I would rent it to a smaller farmer for a little less then the big time farmer.If you want to farm your own ground go for it.Just my 2 cents worth.
 
Don't be afraid of owning your own combine.That way you get the crop harvested when it needs to be.I have had very good luck with a 1460 IH combine.Lots of other brands made in the 80's that if kept up can be very reliable for your farm.Good luck and keep us posted.
 
I get my rent check in January that way all my bills are paid first of the year. Around here some guys once they got the crop you were out of luck getting your last payment if you got a farm payment what I figured was I can take a little less and save on the farm loan interest . I used to like renting to small guys but got very badly burned bigger guy came along huge difference bigger guy does a lot better job of taking care of the farm and it's his son in partnership that has it and when ever he comes over there's a couple of rug rats with him.
 
Sounds like you really want to do it and won't be happy unless you try it.So go for it and it'll still cost less than my sister's boat cruise in France I'd bet no matter what(LOL)
 
30-40 years ago 1/3rds----2/3rds crop share was common in my area but lots of cheating went on and cash rent came in.....Back then the land owner paid for 1/3rd of the fertilizer and 1/3rd of the chemical...He got 1/3rd of the crop....The combining and hauling was all on the renter...

If lucky just wants a place to play with his machinery and realizes that right now it might be tough to make much profit,then he should do it to realize his dream...We have no idea what the yields are in his area and how much cash rent is...
 
Crop share died around here in the 1970s.

Cash rent, latest average is $264 an acre in my county area. Might drop to $245 or so for next year?

Can raise 200bu corn, but a whole farm 175 is much more realistic.

Can raise 60bu beans but not in my own back yard, ph of 8 and wet ground means a defensive bean and 40+ bu is a good year. We grow a lot
of corn on corn in my small neighborhood, beans are just a hobby to break up the boredom of corn.....

We get too much rain, so you have lots of spots most years the low spots are drowned out or at least several acres of 1/2 yield. The fellas with
200 and 70 bu yields in this neighborhood are rounding up and not counting the drowned out spots......

Your rent situation seems poor, but things are done so different in different areas, I'm sure it is worked out right. Tho, if your rent rates are so
low, must be a reason, you dry up or you flood out 1 out of three years, or some such? Something doesn't add up, if there was easy money to
be made someone would come in and rebid things to break even. There is a reason my rents are 10 times yours for very small yield
differences.......

Paul
 
In our area with either a hand shake agreement or a written contract the land owner has to let the renter know before the 1st of September that he won't be farming your ground next year. Usually in the form of certified letter. Just something else to think about.
 
I may be understanding why there is such a discrepancy in responses. If I could get 250$/acre rent - I would have never posted the question in the first place :D

I understand that yields differ from one area to another. Our average yield here is about 100 bushels/acre. My calculations show about 17000 profit with current corn prices and the costs that I paid for fertilizer, pesticide, harvesting in addition to seed and fuel(which I did not have to pay for). I know that there are some other variables that I probably missed but this still seems better than the current 5000 and that's with poor corn prices.

What am I missing? Why are so many people negative about this scenario?
 
If you were paying 100% of the fertilizer,chemicals,and harvesting,then you were getting
taken to the cleaners by only getting 1/3rd of the crop...I can see why you would want to
farm it yourself....I don't think that people are being negative....They just want you to see
the entire scenario...

In some areas 100 bu corn ground would rent from $50-75 per acre,maybe more...
I think that it would be hard to grow 100 bu corn without spending $250-300 per acre
on inputs so I don't see how you would figure on 17K profit with $3 corn.....$4 corn
would be another story..I have no idea what your plant population is or how much
fertilizer you use? Will you no-till or work the ground? Theres lots that we don't know..


In my area for 130 bu corn just the seed,fertilizer,and chemicals can run nearly $250
per acre..If you hire it combined and hauled thats another $50 per acre..Then add in
field preparation,planting,crop insurance,hired help,etc..

Good luck in whatever you decide..
 

I appreciate everyone's input. I understand this is not an easy decision. I will continue to think about it and re-calculate the different scenarios. It is interesting when I was reading about different older combine and planter options on other forums, there were many members farming 200 acre or less places.

The 17K profit was based on 3.50 corn and the fert, pest prices we actually paid this year. So hopefully this is somewhat representative.

My current thinking is to start with about 80 acres. I am trying to think if I should plant corn or wheat on it. It's usually had wheat in the past and I already have an 8 foot no-till drill (for grass planting). So, it seems to make sense to start with wheat. Or do you suggest getting a used corn planter and starting with corn Thanks again.
 
Well, being a small operater myself, I can tell ya it is not all roses. Its hard to justify
buying any new equipment because you don't have the acres to put it over to make it pay.
Running with older stuff is OK, but it is a challenge to keep it all going. It is more wore
out and maintenance and break downs are of a higher rate. I have to do most of my own
mechanic work because the money is not there to hire it done. There is a lot of truth to
the old saying, the big get bigger and the small guys get weeded out. But in the farming
world, it has gotten worse and worse. Partly because the big guys have gotten enormous. For
instance, you might be able to put a little more food on the table with your FSA payments
being a small timer, but the enormous guys can buy a new farm with thier FSA payments. Not
trying to discourage ya. I am for the little guy, like myself. Big is not always better.
But in farming, it sure is getting harder and harder to compete as the little guy.
 
Only do it if you like doing it. You'll get
awfully disappointed fast if you think
you're going to make a lot of money. My
wife and I are up to 150 acres (own 35,
rent the rest) and will not make much this
year. I've always treated it as a hobby that
pays for itself and the assets I aquire
going along are my future profit hopefully.
Anything I make goes back into the farm. Not
trying to talk you out of it, but this
business has a way of humbling you fast with
unexpected costs and weather problems.
 
After reading more comments after I posted, I see you're not looking to get rich quick. Sorry for assuming that. If I had 200 acres at my disposable, I wouldn't hesitate. Could try part of it for a couple years and if you don't like how its going, go back to the way things were. Just a thought.
 
(quoted from post at 09:55:59 09/21/16) Farming is something you have to LOVE. If you don't you will hate it. If you feel the "love" deep in side you then go for it and you will get a certain type of pleasure you can not explain to others. If they have to ask you to explain it, then they would never understand it. To do something you love is priceless. Many folks work a lifetime of labor at a job and lifestyle they hate. What a blessing to do something you love. You might not make much money, and some years you loose some. Don't get crazy with credit and the day job will pull you through the loosing years.Just don't give up on the day job, or think you want to have the big shinny iron the BTOs have.

This is very well put!

My dad farmed, I went into construction. I am blessed that make a great living doing what I do. Would love to be farming and find myself still working for local farmers when they need a guy to fill in on a machine.

But in all reality, the numbers that you run are going to tell you what to do if you are thinking this is going to be a profitable adventure or something that you want to do because you want to.
 
From the time I was 13 on I've farmed, closer to 50 than 45 now. First, going to school and
farming nights and weekends, more of the same in college. I was fortunate enough to get my
own place just shy of 20, 229 acres. Its mine, its paid for. I worked full time until I was
able to take early retirement in my mid 40's and kept farming nights and weekends. Was even
able to expand a bit. I'd encourage you to farm it part time and keep the day job. 200
acres is tough to make a living. Take a week off for planting if need be.

I look at the dollars now, even with a booming hay business and a solid contracting
business. Just the 500 (now) acres would not support my lifestyle without some significant
changes. Over half my inventory is purchased to resell.
 

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