Myth Or True?

There is a story that was circulating in the "80s A farmer who got turned down for his operating money goes home and decides to downsize.He sells all his land except his home farm,gives up all his rented land and sends his big machinery back to the finance company.With the little bit of moneyhe has left after all his debts are cleared he buys 4 horses and some old horsedrawn implements farms the home place only and not only survives but comes out in far better shape than if he had been able to keep going as he had been.

It seems a bit farfetched that this could be a true story.On the other hand it wasn"t that long ago that my area had a family on every 100-150 acres.It was also pointed out to me that all the brick fortresses along the back roads and the big old barns were paid for with money earned farming with horses.

Does anyone know for sure if this could be a true story?

I could be possible but I doubt it. Sounds like just one more internet myth. There is a guy near us that farms part way with horses but he's getting paid to do it by some historical group as kind of a living history.

There were several big things that affected the family farm in the 80's. First place the bankers had been throwing money at farmers and many were in too deep. When price supports went down and the government was trying to get farmers to shut down those deep in debt guys were done. About the same time they closed down the milk can farmers. Many of those guys still hauling milk in cans could switch over to a milk house or quit. Lot of the small guys quit. Most were old and were afraid of debt.

Rick

its sure possible...my godfathers family ran a 200 cow dairy on West Galveston Island till the late 70's...only powered equiptment was a 8N with a one arm bandit loader with a manure fork,a spreader,and a old Ford baler with a Wisconsin engine the 8N drug around...everybody had pickups to pull trailers or wagons during hay season...feds didnt shut dairy down...city annexed and zoned em out of the farm...moved whole operation to Brenham and its still going...since all the old timers are gone i'm sure theres alot more equiptment and debt these days.

They did pay for them with money earned from farming small amounts of land but the price of grain was many times higher then than it now when adjusted for inflation.

When I first moved back to this farm, I told the previous owner some of my plans. He scoffed, and told me "It can't be done..."

I'm doing it.

Lots of guys down size because they cannot afford the huge equipment. Start small, and build up. You don't need a $20,000 baler and a $35,000 tractor to bale hay.....

IT SEEMS TO ME THAT IT IS POSSIBLE. I live on the edge of Amish country in Ohio and they seem to have all the money they need. All the older ones carry cash rolls big enuff to choke a horse. They buy and sell horses have very large farms and work their tails off Few have tractors or combines. They still cut and shock corn and some grain, use draft horses to pull wagons and pitch hay with a fork. They must do something right.

It's certainly possible but definitely not a wide spread phenomenon. With out a printed article or other documentation I would personally consider it a myth but who knows.

(quoted from post at 08:44:17 12/12/11) its sure possible...my godfathers family ran a 200 cow dairy on West Galveston Island till the late 70's...only powered equiptment was a 8N with a one arm bandit loader with a manure fork,a spreader,and a old Ford baler with a Wisconsin engine the 8N drug around...everybody had pickups to pull trailers or wagons during hay season...feds didnt shut dairy down...city annexed and zoned em out of the farm...moved whole operation to Brenham and its still going...since all the old timers are gone i'm sure theres alot more equiptment and debt these days.

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Sure some made it through but many didn't. Lots of guys around us hauled milk in cans to the creamery in Urbank MN but the government shut that down in 83. Lot of the old guys who were small retired rather than go into debt by building the required milk house and buying the equipment. So effectively the government shut them down. Lot of em's kids were gone and no one to take over anyway. Lot of smaller guys here trying to farm now but most have to work off the farm to make it and the bankers here will not talk to you unless you can A. prove farm income on the positive side..... B. have the land to start with and C. be willing to start with at least 80 milking cows. Kinda makes it hard for a young person to get a start.

It's also bad enough that the bigger guys who are renting are getting a little mad at each other as they fight over land to rent (one rented a piece for about 10 years and never told the owner that rent had gone up got really mad when another guy told the owner what land rent was worth and the old guy refused to rent to the 10 year guy again). Funny thing is if the government would cancel CRP there would be a great deal of land available. I know of at least 500 acres within 3 miles of me that would available....maybe more.

Rick

they dont build new 2 row harvestin equipment anymore ,,

All depends on how many hours you want to spend behind a team of horses. We have Amish that do just fine. Couldn't do it just crop farming. You have to run the crops thru animals for the most part selling meat animals, eggs, and produce.

I don"t think it matters whether you use horses or tractors to farm. It"s managing in such away that you don"t carry a big debt load. The old timers didn"t start out with 2000 acre farms. They wisely built up their holdings when it made sense to do so and had the money to pay for it and they tried to stay away from debt.

Some modern farmers want to start big so they borrow, buy new machinery, in many cases oversized to their needs, and finance it by borrowing. Since the margins are slim, it takes many acres of production to just cover the debt payments. If the price drops or the costs rise, or both, there isn"t enough $"s to cover the debt payments and now they end up borrowing more to pay that. That"s a recipe for disaster and it"s just plain nuts. It"s just like what our national government is doing.

All these university economists say you have to get bigger but that"s because their models don"t see the downsize to "bigness". The ecomomies of scale are often overshadowed by the difficulty in profitably managing "bigness" and their models don"t allow for this. They assume a "perfect world".

Look at all these mergers of industrial companies. I challenge you to show how all these mergers have realy made these companies any better. They end up spinning off companies and divisions because they can"t really effectively manage vast numbers of people and make money. Their money is made selling off parts of the busimness not by integrating and effectively managing the whole shebang! The management difficulties overshadow any gain from the "economies of scale".
Look at Russia. Their collective farms were analogus to mega farms. Their "central planning" ruined them and they couldn"t even feed their own people i some minimum fashion. Their workers wee just paid help who got paid whether they worked hard or not.

Family farms were probably the most efficent farms because everyone had a stake in the outcome and nothing was guaranteed. There was a great deal of incentive to innovate and make a profit- you wanted to eat and have a roof over your head! Even then it was a crap shoot. It never was for the faint of heart.

When farms have to hire lots of outside labor or spend tremendous dollars to mechanize on the thin margins avaiable to farming, it becomes an even bigger crapshoot to make money.
i"ve done it again. I got on my soap box. Sorry guys.

Jerry, I like your philosophy. Jim

Why would he have bought horse's? They would cost more to operate,feed,vet,etc than a cheap tractor back then.

probably true, horses a pretty cheap farming once you get them fed. I laughed at one of my kinfolks by us who all his life raised nothing but cotton. along about the mid eighties he sold all his equipment and leased all his ground ,about 2000 acres, out. Said he made more money that year than he ever made farming!thats all hes done ever since,besides he buys and sells a little bit of equipment now and then. He'll buy a good farm at auction and rent it out and make money.

Just have to wonder if an easy living can made running old small equipment why there so few small farms left?

80 acres, with 100 bushel corn, at $3.00 (1984) a bushel. With no input costs thats $24,000 a year gross income. Still have to do all the work, still have to feed the horses, fetilizer, pray for rain and pay someone to combine it. Sounds like an awfully hard way to earn what amounts to minimum wages at best.

OK maybe I wasn't clear. I don't believe the original story posted.

1. Most of the guys who lost thier farms had liens on everything to include the home place so they would have had nothing to farm with.

2. Horses were expensive back then and most farmers didn't know much if anything about driving a horse for field work.

Yea a smaller guy can farm and make it. But most of the time everything will be used to include his car and pickup. He's going to have to have a very tight life style as he isn't going to have much money for play. What he isn't spending on the farm he's going to spend for basic things.

No one said that small farm life was easy, it sin't. There isn't much money for frills or toys and there is a heck of a lot of work involved.

Horses can be very expensive to keep when you figure out that even over winter they eat. Allis Chalmers claimed right after WWII was over that it took about 25 acres per horse between hay and grain, bedding and pasture. That is why they said you needed to buy thier A,B,orC tractor......you could they claimed free up 25 acres for pasture for a profitable animal like cattle or for crops that could be used to feed the extra pigs or mike cows or as cash crops.

Rick

You don't need a $20,000 baler and a $35,000 tractor to bale hay.....

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So, what does a small guy do in this day and age? Use up the old junk, right?

There's virtually no "new old junk" coming in because the new equipment is way too expensive. Everybody's avoiding buying new equipment and using up the old junk.

All the old old junk is getting older and junkier all the time.

Eventually the old old junk will no longer be serviceable. Then what does a small guy do?

I live in Amish country too and also see the Amish that have a pretty big bankroll. The thing is though, they have that for a reason. When you have 12 kids, even on a farm where there is always something that needs to be done, alot of your manpower problems go away. You have heard the saying that many hands make light work, well the Amish usually have 24 of them around. Also, around here, the kids are not "adults" untill 21 so all the money the "kids" make belongs to the family. The one family I know pretty well right now has the eldest son working off farm as a carpenter, second oldest working at the local cabinet shop and the 2 oldest daughters working at the cheese plant. Since kids are done with school in 8th grade, thats almost a decade per kid adding income to the family. If they have 12 kids, thats around 100 years of wages that go into the family. And you thought you had it good just because your wife had a job "in town".

Now, can you "make money" at farming with horses? Sure. Much? Not really. Again, the family I know well runs 12-14 milk cows and the milk goes to the cheese plant and gets made into cheese. The cheese is then sold and the farmer gets paid based on the cheese price so its a value added price, more than just a milk check so to speak. He runs a little under 80 acres, 35 at home and some other rentals, most small that the local farmers cant get into too easily. Think you are going to do that with 2 horses? Not a chance. He has 12 horses and still runs short. I keep track more now because when I first asked, he had 14 and at that time only 12 milked cows. The math just dont add up with those numbers. 14 horses to get milk from 12 cows? Losing money right there. Run the milk through the co-op and sell the cheese, you make some there but not alot. You are still pretty dirt poor at that point and you HAVE to grow and eat everything you can right on the farm. Not a big problem baause you have a ton of kids to do all the work but Im just saying, you dont have the option of doing anything other than that. Now, get a couple kids working off the farm and watch your income skyrocket. Thats when I see the Amish start walking around with rolls of cash like John Gotti. But you have to ask, do they have a wad of cash because they farm with horses? No, there are alot more pieces to that puzzle that you have to look at

"Just have to wonder if an easy living can made running old small equipment why there so few small farms left?" That's simple. Greed and ego.

Plenty of Amish doing REALLY well and some not as well around me in Ohio.

I also see plenty of BIG farms seem to be doing well too and buying up all the land they can around them.

Haves and have nots all around.

DICK L has a great point about the Amish raising crops and feeding animals and then marketing such. my neighbor who I have lived next to for 35 plus years who will be 95 in march farmed 104 acres with a allis b and a 135 massey ferguson and a one row New Idea picker, and done it profitably I suspect, as he still owns the farm and up until 2 years ago still picked a small amount of asparagus to sell by the road side and also cutting and splitting firewood for himself , on this farm he grew corn, hay, asparagus, concord grapes and feed cattle that he sold to the market, no wife or children of his own to help ,how ever he did hire school kids every year to help pick asparagus when he was younger . He was well into his 80's before he quit feeding cattle and rented portions of the farm out. I believe the key is that he never intended on being wealthy or the largest, but to be a sustainable business.

Its greedy to want to make more than minimum wage?

A lot of the small farms died cause the kids grew up and moved on while dad continued to farm. When he retired he sold out. Heck of a lot of people who want to farm can't get the backing to go in and start small. The banker is demanding X number of acress and cows to start and wants the wanna be farmer to have new or newer equipment. IN part cause of interest and another part cause they want to be sure the farmer gets his crops in and out on time.


Plus add in that people are not willing to work like slaves for little money. Most younger people want money but don't wnat to work more that 40 hours a week and have holidays off.

Rick

(quoted from post at 17:10:25 12/12/11) A lot of the small farms died cause the kids grew up and moved on while dad continued to farm. When he retired he sold out. Heck of a lot of people who want to farm can't get the backing to go in and start small. The banker is demanding X number of acress and cows to start and wants the wanna be farmer to have new or newer equipment. IN part cause of interest and another part cause they want to be sure the farmer gets his crops in and out on time.


Plus add in that people are not willing to work like slaves for little money. Most younger people want money but don't wnat to work more that 40 hours a week and have holidays off.

Rick

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I don't think that is unique to farming. Getting a banker to fund a new biz is very difficult.

The farmers who made a descent living off 200 acres (my Grandpa in particular) in the '40,s / '50,s / '60,s all had one thing in common that the ones who couldn't make it didn't have. It's the one thing that will make or break ANY bussiness. They had a passion for what they did! It wasn't "work" to them , it was their passion. A person who makes a living out of his/her passion never "works" a day in their life. My Grandpa was one of those people. He never farmed over 200 acres. Never rented land. Paid for everything he ever bought , when he bought it. He would rather spend a day cultivating than a day on what the rest of us call "vacation". Bibs were the dominant garb. He looked out of place dressed up. Only put in his teeth when he needed them. Teemed up with three other neighbors to share balers , combines and corn pickers. Each only had to "own" one. There's a way to do it! Most just refuse to do it that way!. Bless your sole , Grandpa Rendel , you showed me how to be a better person. You probably thought I had forgotten about you. Never. RB

That's Grandpa on the right and Great Grandpa on the left and Mom and oldest brother far left. Back when they all had orchards too. All are gone but the little "boy". He's 65 now.

The main reason why there aren't many small farms left is mostly because of quicker ways of doing things. Let me explain, if it took 10 hours to plow 10 acres with a team of horses( I know this isn't possible but it makes for easy math), or 1 hour to plow 10 acres with a large tractor and plow then you have 9 hours to make money other ways. On the other side of the coin, now you HAVE to work more hours to pay for the tractor. So since you can cover more acres faster now you need more acres, and then you end up buying newer and larger equipment so you can do the same job faster. Which then turns out you need/have more time to farm more and make more money. Basically you can make it either way if you work hard all day every day, it's just physically easier doing it the newer way and probably more efficient.
I was reading in a Successful Farming magazine from 1950 how some of the smaller farmers weren't pulling their weight since they only farmed 10or 20 acres and they used more than they produced. The authors argument was that they should move to somewhere else and let the larger/ more efficient farmers farm the ground and help feed the world that way.

sometimes the big modern way isn't always best,knew of dairy that had been in business for a long time they managed it real well and tried to keep up to date ,during the buy out they couldn't move the cows immediately so they put them back onto pasture instead of confined feeding feed them as they did years before to maintain health and get what milk they could, one of them made the statement that if he had of known they could made the profit margin they were making for the amount of inputs used during those last weeks of operation he would still be in business,so bigger an up to date isn't always best

my folks made a living on 160 acres. mom worked as an rn in a nursing home. this was in the 60s and 70s. started small, one piece of used equipment at a time. 5 old farmall tractors, never paid over 500 for any of them. raised cattle, sheep,pigs goats,horses,chickens and rabbits, something always made some money. of course we never wasted anything! they built a new house in the 70s, most of it done by us. 3 of us boys, never had much extra but were never lacking what we needed. dad is 83 now, rents all his tillable ground out now to a young farm family. he told me just yesterday that he hasn't owed anyone any money for many years. he loved farming and still keeps busy almost everyday piddling and raising beef cows. he just bought a 1962 606 ihc loader tractor with p/s, the snazziest tractor he has ever been on! i don't know if it can be done today or not. lowell

This is a most interesting post.

I'm a small guy and a fairly new guy getting ready to expand. Some of the things I'm reading here I'm doing myself, using and repairing "obsolete" equipment, creative management etc.

Lot's of truth in here; tough to find financing, must have passion and be willing to work hard and believe in what you're doing.

Ask me in a year or two how things are working out!

Thanks. With all the MBA"s out there, if the business models were correct we ought to be rollig in prosperity. Last time I looked, we werent!

Theres always wild stories just like this one going around to start with he wouldnt have had enough money to buy good horse stuff. Just try and find a good deal on harse drawn stuff at a price you can afford.