# Profitable Land



## whatHekeeps (Aug 30, 2011)

Hey,

New to the farming community I am. Didn't grow up on a farm or nothin like that but i dang near want to start the heritage. 
Might be somewhat of a broad question but I am wondering what can I do to profit land? I know today isnt like it was back 100 years ago.

I figured the options to be: grow plants or market livestock.

im talkin at a microeconomists level you see. am i missing some options?

Not looking to be a rich man, just to make an honest livin.

I know in todays economy to make a 'good' livin i would need another source of income to even start with. Well, I know also that there has to be ways of makin a good deals profit off of my land, even today. Maybe it depends where I live and what others are doing in that area you figure? Im looking for somethin that would outweigh the costs in the long-run: isnt everybody? Im from Louisiana. Im 22 years old. I realize I probably lack a lot of interest in this but that isnt gunna stop me from wondern.

Anybodys input on their experiences would be greatly appreciated.


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## Teslan (Aug 20, 2011)

I almost feel that for family run farms you have to almost inherit the land and machinery to start. Especially in this area with land prices (or I should say water rights prices). For a 160 acres here with adequate irrigation the price is usually above $1 million. I know of one guy that was your age when he moved here about 10 years ago. He started farming by doing custom work. He started by simply cutting hay with a used swather. He now owns, rents about 300 acres (a good size here for a family operation) However I think he's up to his eyeballs in debt. Oh and be prepared not to have any kind of social life in the summers if you are truly prepared to farm.


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## mlappin (Jun 25, 2009)

At one time I would have suggested looking at organic as a way to get started, not sure where that's going these days. One of the first organic dairies in our area has gone back to conventional, said it just isn't worth the extra hassle once all the paper work is figured in and the cost of organic feeds. My friend almost went back to conventional this spring as well for much the same reasons.

The real money in our area is in specialty crops. Seed corn, green beans, cucumbers, tomatoes and mint. Problem with that is first you have to have the contracts, then it takes a lot of expensive specialized equipment for it.


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## whatHekeeps (Aug 30, 2011)

Thanks for the replies guys.


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## TheFastMan (Sep 3, 2011)

I'm kinda where you are. My dad grew up on a small farm, but he was a cop his whole life and didn't farm. We have 17 acres of our own and I cut about another 10 down the road. My brother and I got interested in cattle a few years ago and then doing hay. I'm working towards a degree in Animal Science currently. We already had the land (though it's not a lot), so I can't advise too much on that. We bought all our machinery. That can get expensive in a hurry. Since we buy older stuff, we can pay for pretty much all of it out of pocket. That also means we've acquired things rather slowly. Do not buy cheap equipment. The saying "pay me now, pay me later" comes to mind. I work part time and between school and the ol' homestead, I'm pretty much broke all the time. I spend all summer working my job and baling hay. I haven't had a vacation in 3 years. Organic may not be a bad way to go. We discuss this in about all my classes. It is a growing industry in about every segment of agriculture. I've learned that input costs for organic is generally always higher than conventional, but you generally get more for organic products. It's a niche market, some people want it and are willing to pay for it for whatever reason. I'm just going by what I've learned in my classes and I don't have much first hand experience with it. Finally, after doing this for a few years, I've found there is a lot more to it than just planting some seeds or cutting some grass. There is a lot of wisdom and techniques you will only learn from years of experience.


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## mlappin (Jun 25, 2009)

Thing you need to keep in mind about organic, you get more for a crop, but they generally yield less. Organic hay usually yields the same, row crops don't, least not in our area. Generous rains make keeping beans weed free nearly impossible without using chemicals, corn will get over run with giant rag weeds in our area as well. Can be hard enough to keep the giant ragweeds at bay with chemicals.


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## IHCman (Aug 27, 2011)

Teslan said:


> I almost feel that for family run farms you have to almost inherit the land and machinery to start. Especially in this area with land prices (or I should say water rights prices). For a 160 acres here with adequate irrigation the price is usually above $1 million. I know of one guy that was your age when he moved here about 10 years ago. He started farming by doing custom work. He started by simply cutting hay with a used swather. He now owns, rents about 300 acres (a good size here for a family operation) However I think he's up to his eyeballs in debt. Oh and be prepared not to have any kind of social life in the summers if you are truly prepared to farm.


I just wanna add my two cents to this. I grew up on a farm/ranch and always wanted to ranch but Dad didn't have enough acres for the both of us when I got out of HS. Wasn't much land for sale at the time and I didn't have the equity to buy it anyway. I got started small, bought 10 cows and 5 heifers, rented some small 40 acre pastures and put up some hay on shares. I did work with my parents, exchanging my labor for their machinery and we still do some of that today. I bought 25 more cows the following year and was able to rent more pasture. Over the course of the next 5 years I bought a few pieces of machinery, bought a few more cows, and saved extra heifers to build my herd and pay down my debt. Of course I worked off the farm to for 7 years before I was able to purchase 1320 acres of land and bought more cows making me able to ranch full time. I did have to go to FSA to take out my real estate loan as I didn't have enough equity to use another lender. But I kept my cattle and machinery debt at the bank. I also took advantage of Equip programs through the NRCS to install wells, water tanks, tree plantings, alfalfa seedings, among other things. Being a beginning farmer helped there as well as that qualifys you for an increase in payments. Really helped me do some improvements that I wouldn't have otherweise been able to afford. My struggle now is much like you've said about the family farm. My Dad has increased his acreage to close to 4000 acres. Even if I buy it at half the going rate here in ND, I don't think I'd ever make the payment. I need to get my other 1320 payed down before I could even think of handling a debt load like that and I won't be baying off my first RE loan anytime soon. One suggestion I had for him was a sort of a rent to own type thing. My suggestion was he put my name on his land with his name with some sort of trust or right of survivalship clause. Then we agree upon a price per acre and I begin paying him annual installments and upon his passing I either continue paying to an estate or have the land free and clear his choice. It'd guarantee him a source of income in his retirement years and also keep the land protected from me defaulting on it. If I couldn't pay for it, he'd still have the land (unless he'd passed away) rather than a bank having it and possibly keep my payments small enough to be manageable. Really just a thought, haven't looked into the legal side of any of this. One complication would be my sister who doesn't farm. I figure she could have a greater share of any money left after the passing of the parents or however the parents would see fit. I'm just looking at ways to keep the family farm together as Ive been helping my parents take care of the land since I was a kid and probably even more so now as an adult and I'd have a tough time seeing it sold to the highest bidder especially if they didn't take care of it like I have.


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