How to finance becoming a farmer?

[Bird]

Michelle, we don't have too many days when it hits 100 degrees, but my barn was not shaded by trees and it was a corrugated, galvanized sheet metal; wide open on one side and a very large open door on the opposite side, but could still get quite hot. If everything's in the shade, maybe no problem. Some of the plans I saw for rabbit barns included huge exhaust fans in one end of the building, and the wet fiber material in the other end; i.e., made a big evaporative cooler out of the building.

And yes, rabbits normally nurse once or twice a day. I'd like to see your "properly constructed" nest boxes. Of course, one way is to have them recessed in the floor of the cage. And of course the bottom of the nest box needs to be ventilated to allow the babies' urine to dry. And I think most folks use hay for nest material, but I found that newspaper run through the shredder worked even better (not a cross cut shredder but simply the 1/4" shredder).

You always want to have fresh water available. Feed is another matter. If you feed them too much, they get too fat and refuse to breed.

450-800 does? I don't see how two people can handle that, even full time. One of the books I read said 100 does and two people full time might make $30k a year.

[qtkitty]

I have heard people talk about heat chimneys ... from what i can gather they build a chimney type construction and the heated air goes up and out that chimney( i am assuming the chimney has a closing mechanism on it so that it can be shut int he winter so that more hot air can be kept towards the bottom of the building).

I have also heard of extremely high barn roofs which allow the heat to get away from the ground level. The keeping shade around the outside of the building keeps the ground cooler so there is less radiated heat into the building.

I have also heard of water systems on the roof where evaporating water on the roof keeps the roof cooler and from radiating its heat into the building.

Once you get into paying for electric to fun those fans all day long, then you eat into profits REAL fast, expecially with as expensive as electric is anymore.

Yeah i know but they always say that rabbits only nurse one time a day .. i know thats a bunch of bull.. yeah they do not stay with their babies when they are in the nest .. but they go in there more then once. Our Daisy Dot she is a terrific mother .. she has had 2 litters of 4 bunnies each.. both times she nursed them more then 2 times. This last time she nursed a max of 4 times a day. Yes my bunnies are different then meat rabbits, but the basics are still the same... sometimes [img]/forums/images/icons/wink.gif[/img] .

I actually use small card board boxes of course i could not do that if i was running a rabbit farm.. i do about 2 inches for a dwarf to jump to get out.... the more material you put in the higher you have to make the lip ... everyone tells me hay is best, but i also have found that my bunnies respond the best to shreaded newspaper. I have had no conjunctive eye issues so i am very happy with that.

Everything i hear is that recessed nest boxes are a waste.

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One of the books I read said 100 does and two people full time might make $30k a year.

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* frowns * with todays feed costs that just isn't possible, atleast i don't think so. Okay let me do some calculating.. remember i always calculate to me lossing.

okay you have 100 does each doe has lets say 5 live babies by time to go to the processor.

That is 500 babies.

Perfect market weight for fryers is usually 4.5-6lbs.. so lets say the average was 5 lb.

That is 2500lb of meat... lets say you have a regular contract with a processing company for $1 a pound .. which if the demand is high in the area then thats a GREAT price.

So over all you have made $2500

Lets take your 3 litters a year .. so that would be $7500 per year.

My 5 litters per year it would be $12500 her year.

okay well we have yet to take out the cost of feed.

To feed a rabbit out it takes 4lbs of food to 1 lb of rabbit meat. People who are really good at getting amounts perfect can go as little as 3.1-3.7 lb per lb rabbit.

Lets go with the 4 to one ... 2500lb rabbit fed 4 pounds of food to get to weight. That is 10,000 pounds of food for each batch.

Then you also have to feed the does during their lifetime ... lets just say it takes the same 4 pounds of rabbit food per female bunny per pound per litter to keep the doe. Does are grown out so they weigh what about 7lb depending on the breed. So that would be 2800lb of food per batch. ( Let's say that also keeps the bucks all feed as well to make it easier )

Rabbit food goes bad with in 3 months so basically every breeding you start over new. One breeding you would have 12800 lb of feed. At a feed store you would be paying about $8-7 per 50lb bag of feed. $1792-2048 just for feed each breeding.

3 breedings per year would cost $5376-6144
5 breedings per year would cost $8960-10240

Let make that tons since you can get better bulk prices per the ton at feed mills. 6.4 tons.. which i dont know so i will not go there *lol*

3 Breeds per year you would make $2124 per year.
5 breeds per year you would make $3540 per year.


"A 400-doe rabbitry is generally considered a full-time operation for one person. " http://www.ext.nodak.edu/extpubs/alt-ag/rabbit.htm

At 400 does you would probubly be able to get better feed prices out of sheer volume alone, however you would have to have a regular High volume of rabbits at a processor.

It would be something like:
400 does
2,000 rabbits per cycle
6,000-10,000 rabbits per year
30,000-50,000 lb of rabbit a year
$30,000-50,000 for rabbit meat per year
25 tons per cycle
76-128 tons per year
$7168 of feed per cycle ( probubly could get it lower because of volume)
$21504-35840 of feed per year
And you make $8496-14160 per year.

Of course those prices do not incluse other sales of manure nor brackage of equipment wear and tare on vehicles and gas.

[beenthere]

That will be a hard sell to a banker, and it sounds like it isn't a very profitable business venture, if I read your figures right. Might even run a big loss.

Maybe raising rabbits is just for fun, or a hobby. [img]/forums/images/icons/confused.gif[/img]

[qtkitty]

Of course that is totalling for me as well... better totals can be made if i knew the area and the feed mills near there .. the breed of rabbit .. It also would depend on how well i could go that fine line between 3lb of feed per 1lb of rabbit meat and 4lb of feed per 1lb of rabbit meat.

So the less the price of feed and the amount being fed to create 1 lb of rabbit .. and the higher price that a processor would be willing to pay changes the finishing total dramatically .. a penny per lb of feed or an extra oz. per bunny can make a BIG difference.

That is also a one person opperation for the 400(to 450 ) range supposedly.

[Bird]

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Maybe raising rabbits is just for fun, or a hobby

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When I started, it was primarily because I, and most of my family, like to eat rabbits. [img]/forums/images/icons/wink.gif[/img] I checked into the possibility of making any money, and as with any venture, you've got to have a market for your product. At that time, most of the processors were in Arkansas. As a member of the American Rabbit Breeders Association, I got a magazine which, in each issue, listed the processors and what they were currently paying. So I knew I wasn't going to make any money, but did try to sell enough to offset some of the costs.

[wingnut]

Just a couple of comments (late in the game) regarding financing.
Because of my background, I tend to have different views on "profitable farming". First off, lets talk about the myth of the family farm. This is not a career ... it is a lifestyle. A family farm, especially a "mixed farm" was a way for a family to EXIST ... not get rich. Worked properly, a family farm would provide sufficient food for the family to exist, as well as providing surplus foodstuff as to trade for those items not available on that farm. It never was a place where the farmer expected to make as much as an assembly line worker in Detroit.
Those farmers who DID want to become wealthy had to change that lifestyle completely. The size of a family farm precluded intensive farming .... grain, corn, or other crops needed to cover a lot more acres that Joe AverageFarmer could do on his own ... which is why they can't compete to the big Ag guys with million buck tractors/combines/etc.
Replacing the family farm - due to lifestyle as much as economics - are us "hobby farmers" who support our farming efforts with "day jobs". That allows us the luxury (which is what it is) of having miniature horses, or crops of garlic, or an acre of lavendar or suchlike. We use our wages to subsidize a farm that might make a few bucks but never allow us to live as we've been accustomed to ...

Now, to loans - from government farm agencies or banks or other .... research "business plan". Anyone who might be prevailed upon to loan you money will be interested in one thing and one thing only .... what your business plan shows (and doesn't). They're going to be looking to see what the economics are ... can you repay the principal and the interest which will be accruing. Can you make enough profit, or generate enough cash - after servicing the loan - to continue to operate. If you default, will there be enough value to seize to satisfy the loan. Basically, can YOUR business serve THEIR business (their business is to loan money and make a good profit off the interest). You will live and die on your business plan - if the lender sees that you've done your homework and have outlined a reasonable chance of profit, you have a chance of getting money. If, however, your business plan revolves around getting other people to pay huge sums for elk antlers for male potency potions ... well, likely they'll politely say "thanks, but no thanks".

If you find a niche market ... like supplying local markets/stores with a popular garlic clove or something like that .... you have enough land. But you need to do a whole lotta research. There are things that might be profitable, and may be do-able, as long as you identify the market and assure yourself that you won't be immediately replaced by a bigger operation who sees an opportunity to expand. That would usually indicate labor-intensive (rather than capital intensive) things ... like food animals that don't require much land (e.g. meat goats or milk goats).

Anyway ... good luck, you seem to be doing things right by doing a lot of research before diving in the pool!

pete

[qtkitty]

Profitable to me is making enough to keep a roof over our heads and pay the bills, food in our mouth, a vehicle to get from point a to b, to clothe ourselves, and a little extra above and beyond that is funds to save to use later.

I do not want a farm to piddle and play and have tons of pets ... although any animals for fibers and milk will definately be doted on. I want a farm in the end that will serve us and make us a little money. I want to make sure that it will be able to work before we go trying to get $ as well .. so i research and talk on forums to gain insight. "Learn to do, Do to Learn" as they said in FFA.

[Pat]

I find it hard to say anything smarter than Pete said or to say it better. It is somewhere between difficult and impossible to do what you have stated as your goals. Without decent paying "day jobs" or retirement checks (or other sources of funds) most small farmers are not profitable enterprises.

I live in cattle growing country. Most small operators have to subsidize their cattle businesses. The more intellectually blessed realize that farming and ranching is a lifestyle for small operators and not a profitible buisness arrangement in many instances.

Apparently you know how to "do the math" so don't shirk close analysis and don't gloss over expenses like "a car to get from A to B." You need to work up a detailed budget analysis of all the $ it takes to pay for EVERYTHING for, say, 10 years (at least 5.) Insurance of all kinds, clothing, housing, taxes, and on and on and on... You realy need to get detailed in your estimate of EVERYTHING you spend. This includes fast food, $ for allowances for kids, EVERYTHING! If it doesn't add up to more than you expected you either missed a lot or live like hermits.

When you have included every imaginable expence including Girl Scout cookies, Haloween candy, and such... then work up an income estimate of equal detail and show where it is all going to come from. Don't let yourself off the hook with generalizations and wishful thinking. Be specific. You have mentioned how you like to estimate slightly pessimistically so as to try to be more realistic. That is a good start but you need to expand on it considerably. This can be a VERY sobering exercise if you do it honestly and in great detail.

Odds are if you do this unemotionally, in fine detail, with no unbacked claims introduced by wishful thinking you will NOT find a way to show a profit in the first 5 years (and probably not the first 10 or 20 either.) The IRS will NOT wait that patiently.

Banks don't like to make meaningful sized loans based on your enthusiasm and desires. If your outgoes are reasonably likely to be bigger than your incomes for any reasonably protracted period then you are NOT a good candidate for a loan. Ag loans are useful to level out cyclic income or to capitalize a venture that can throw off enough profit to reduce the payback risk.

Again, Pete told it like it is! A bank wants to be sure that at any given instant over the life of the loan that if for any reason you didn't make your payments that there would be enough assets such that when liqidated for xx cents on the dollar at auction, they would not lose capital.

I hope you find a way to do what you want to do, even if the kids have to have paper routes and you both have to have day jobs.

I really do wish you the best of luck. No one here wants to prevent your success in any manner. The kindest thing we can do is try to help you find out what the "REALITY" is in your situation before you leap off the high place with a home made bungee cord that is longer than the height of your jump.

[img]/forums/images/icons/smile.gif[/img] [img]/forums/images/icons/smile.gif[/img] Pat [img]/forums/images/icons/smile.gif[/img] [img]/forums/images/icons/smile.gif[/img]

[wingnut]

Good information, Pat!

Michelle, we may sound pretty pessimistic, but we also may have very good reason to be. My aunt and uncle tried to make a living with mixed farming in north central Alberta. They understood it was a lifestyle and not a way to become rich, and still ... when it came down to it .... my aunt dies of a heart attack, because the welfare money she was getting for medication ... she spent on groceries instead. My uncle still lives on the land, but it's not being farmed ... he's just getting by on his pension (the Canadian equivalent to Social Security). I've known several successful farmers - one was an elderly gent who happened to be the father of a brother-in-law's wife. He was farming a section of grainland with equipment that he'd paid for a long time back, and spent time and money maintaining. Because he didn't feel the need to grow every year, he wasn't at the bank every day with a new scheme to get bigger (more land, bigger equipment). He was also the only farmer in the area with money in the bank (and lots of it). My step-brother is also quite successful - raises cattle in northern Alberta. He's also resisted the urge to keep getting bigger and keep upgrading his equipment, and - consequently - he has money that would have otherwise gone to servicing loans. In both cases, of course, these two worked a whole lot of years to get to where they are today .. 35 years in the case of my step-brother ... with a lot of dry and tough years.
I'll echo what Pat said ... as long as you're upfront with your budget, it is doable ... but you need that "reality bites" look. Wishful thinking and "windfall" attitudes will sink you faster than a stone. My brother is trying to turn long-haul trucking into a career and I really worry about his future. He doesn't understand the concept of owner/operator at all ... thinking that by just turning his rig in every three years (at the end of the lease period) will keep him in new trucks and he won't have to worry about repairs because it'll all be warranty. This leads him to believe that a good month - with extra money left after loan and operating costs ... is a windfall. He seems to forget that he needs to have a cushion in case something happens (that warranty will fix the truck, but only miles hauled provide a paycheck ...) ... and he seems to forget that small fortune he owes our mother - who keeps bailing him out (sadly ... for any chance he'll ever mature).
Everything costs, in this day and age, and only very good accounting habits give you any chance - of staying ahead of the bills, of getting operating loans, of keeping ahead of the IRS, of being ready for vet bills, etc.
Unfortunately, it's not as easy as it used to be. "Used to was" (as we'd say in the day) you could count on your neighbors to come over for a barn raising, take care of your stock or crop if you were indisposed, bring over chicken soup if you had a cold, help you out at harvest (and, of course, expect the same from you should the roles be reversed). Today, however, you can only truly count on yourself ....

Again ... the very best of luck with your activities, and we all do wish you every hope of success! [img]/forums/images/icons/smile.gif[/img]

pete

[Pat]

This afternoon I rode along with a friend/neighbor on a 100 mile round trip where he saved about 100 dollars on ag chemicals. The time was recreational as we had a chance to chat but with diesel at $2.19/gal for a 1 ton flatbed (15 MPG) this was not all gravy. Anyway I asked him if he knew of any small farmer in the area (this guy was born and raised here and knows everyone) that, on average, was operating in the black with no support from outside (non-agricultural) income.

--- Nope ----

Some do better than others but everyone we know either has a job or retirement ncome, or investments, or other sources of income to finance their agricultural interests. Some folks go on cruises, some buy expensive new cars, and some eat out a lot, all expensive endeavors. Alternatively you can put the money into your agricultural "lifestyle" if you can aford it.

My friend is probably the most enlightened and progressive cattleman in the immediate area, has about 400 acres and 50 head of mostly black angus but still has to subsidize his cattle operation with his retirement check. He allows as how IF he were totally debt free and had no interest payments to anyone he would run at about an approximate breakeven (most of the time.) If he didn't have health coverage in his retirement then breakeven would be out of reach. This man is frugal as well as intelligent. He lives in a portion of his shop building and has no frilly clothes or new vehicles. He works about 60-80 hrs a week.

If he can't do any better then I hold no illusions as to what I can do on 160 acres so I will try to keep the ag ops from bankrupting me and enjoy the LIFE STYLE.

[img]/forums/images/icons/smile.gif[/img] Pat [img]/forums/images/icons/smile.gif[/img]