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Newbie Selling Hay- NY


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#1 firecatf7333

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Posted 08 November 2011 - 01:20 PM

I will be buying land shortly and building a house and want to do some small farming on the side. I live in upstate NY so i think we get 3 cuttings per year. I'd like to raise either beef or sheep, so i'm not sure if i will need squares or round bails yet. i was wondering if its even worth my time to sell hay, assuming my area targets mostly horse markets, maybe dairy farms, but i'd think most of them make their own silage. Anyone from the area could commment. Anyway, lets say i hayed a 50 acre field, what could i expect in terms of the # of square bails(assuming easier to sell then big round) per acre? i looked on hay exchange and squares around 50# seem to be $3-$5.

i would be using older equipment since this is only a side thing and its not worth it to buy new stuff to hay small acreage.

thanks

#2 RockmartGA

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Posted 08 November 2011 - 03:46 PM

My standard response to folks just getting into the hay business such as yourself is to find someone with the equipment who is willing to cut and bale on shares. Basically, you would fertilize and spray the field and the other person would cut and bale and take a share of the crop (usually halves) as payment for his services. This allows you to get your feet wet, so to speak, without the expense of buying equipment.

If after a year or two you think it makes sense to buy the equipment, then you have a couple of years of practical experience to draw upon. You would have a better estimate on the crop yields, market, etc, etc.

No, you're not going to make much, if any, money this way, but it may prevent you from making a costly mistake.

#3 Fowllife

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Posted 09 November 2011 - 08:05 AM

Personally, I wouldn't put 50 ac into hay without having a market first. I would find someone to cash rent most of that field for grain, and start out with a smaller section for hay. With your location, and how hard it is to cure hay up there it would be hard to jump into 50ac of hay.

I do agree that a share crop would be a good way to start, but on IF you can find someone RELIABLE to share crop with. The right person would be a grat setup to start out with, but the wrong person and you may not get any decent hay. You may always get your cutting done way too late, or have them get rained on.

Read as many post on this site as you can and get an idea of your equipment, labor, seed, and fertalizer inputs. When you add all of this up it may not seem like a very good idea. There have been some very good post made lately on the true cost of hay production. I'm not trying to talk you out of it, just make sure you run a budget to make sure you can make it pencil out before you drop $50k+ into getting started.

If you look at web soil survey online you should be able to get a rough idea of your tons per acre.

http://http://websoi...SoilSurvey.aspx

#4 NCSteveH

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Posted 09 November 2011 - 07:15 PM

I am going to have to say that yes you can make decent money in hay, after a few years, and with some luck sprinkled in. This year I would have been in real trouble if I didn't take advantage of a small weather window in June, but I would have never been able to take advantage of it had I not invested in an accumulator, grapple and 5 more 20' wagons in addition to the 2 new tractors, baler and wheel rake in the past 4 years.

I am also lucky in the fact that I was able to pay of my farm solely on the profits from the fields, for the first 10 years I put every penny right back into the farm. In the last 6 years the farm has been profitable but it was not easy in the beginning.

I will end in giving two pieces of advice, if you are going to do hay, buy enough tractor and don't cheap out on a baler.

#5 TheFastMan

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Posted 10 November 2011 - 10:35 AM

Don't go cheap on equipment either. It's usually cheap for a reason. That is, unless you are a good mechanic, but it is very very frustrating when a vital piece of equipment goes down right when you need it. Always ask to see whatever you are looking at operate (if feasible) before buying.

#6 firecatf7333

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Posted 10 November 2011 - 11:37 AM

Anyone from the Northeast, specifically NY, that can comment. This is where my market is so thats really all that matters. I don't think its feasible to ship hay very far is it? Can anyone break down the expenses and possible profits if i were to hay 50 acres. Assuming 50# square bales at $3-$5 per bale. I know we get about 3 cuttings in upstate ny but i'm not sure how many tons per acre

#7 covenanthay

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Posted 10 November 2011 - 12:42 PM

I budget my hay production at 4 ton per acre which on your 50 acres would yield 8000 bale. Is this going to be a new seeding or a run down grass pasture? The cost of seeding 50 acres, buying equipment, finding storage, finding a market, and finding time (assuming you have an off farm job) are all major roadblocks. Start small and learn/pay as you go.

#8 Fowllife

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Posted 10 November 2011 - 01:30 PM

I believe Iowa State University has a hay budget calculator on there website that you may find help full. Just some rough numbers for you though, assuming good quality used equipment. These are estimated prices of what I would want to use to do 50 ac. You could spend half of this and have what you need, but personally I wouldn't risk it for 50 ac myself.

Initial investment
80hp tractor - $10-20k
40hp tractor - $5-10k
Baler - $10k
Mower - $10k
Rake - $3k
Tedder - $3k

Thats $41-56K in equipment. That doesn't include anything to get it off the field. You either need several flat wagons, or an accumulator and grapple for your tractor, or a pick up wagon. Any of these option are probably going to add another $10-15k by the time it is all said and done. If your carefull and shop around I'm going to say you can get what you need, bare minimum of $50k.

As for establishing a field, most average around $400/ac, so add another $20k to your equiment for that. Now your at $70k min. to get ready to make hay.

That much hay in small squares you are going to need some help also. If you have an accumulator or pickup wagon, and a grapple on your tractor you may be able to get by yourself though, but doubtfull. Figure you may have 50 hrs per cutting, X3 for 150 hrs a year, maybe more, maybe less. You need to be able to pay yourself something, plus $10-20/hr for any hired hand. Then you also have fuel and maintance on your equipment.

On top of all of that you need to figure in either land rent, or your payments on the land, plus property tax, plus insurance, interest on your start up loan, or interst you losing by pulling it out from whereever it is. You also need to figure in your fertalizer cost ($100-150/ac/yr +/-) As you can see there are alot of number that need to be figured into this equation. That spreadsheet from ISU that I mentioned does all of this.

You also need to figure that all of your hay isn't going to be high quality horse or dairy hay. Chances are something will get rained on, cut late, or whatever else and your quality wont be there and will sell for less, if at all.

The ISU bugdet is on this page

http://http://www.ex...html/a1-20.html

Im not trying to scare you away from doing it, it's just a little more complex then some people make it out to be. IMO it's a lot to just jump into.

#9 swmnhay

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Posted 10 November 2011 - 08:47 PM

[quote name='Fowllife']
.

As for establishing a field, most average around $400/ac, so add another $20k to your equiment for that. Now your at $70k min. to get ready to make hay.


On top of all of that you need to figure in either land rent, or your payments on the land, plus property tax, plus insurance, interest on your start up loan, or interst you losing by pulling it out from whereever it is. You also need to figure in your fertalizer cost ($100-150/ac/yr +/-) As you can see there are alot of number that need to be figured into this equation. That spreadsheet from ISU that I mentioned does all of this.


$400 acre for establishing a field?Plus fertilizer and rent?

I would say under $100 for seed.

#10 Fowllife

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Posted 11 November 2011 - 06:30 AM


$400 acre for establishing a field?Plus fertilizer and rent?

I would say under $100 for seed.


That $400/ac is a number that I have seen thrown around here quite a bit, and it makes sense to me when you figure in all the cost to plant.

$100/ac for seed
$100-150 for initial fertilizer application, maybe even more depending on the soil
$50/ac for lime, applied
labor, fuel, and machinery to till and seed, or burndown and no-till

Plus just getting stated he would be hiring the burn down, and renting a no-till drill, or buying one. If conventional tillage he would also need to rent/buy tillage equipment, or just hire it all out. Either way, I think $400 is close. Now for someone with an established farm and equipment, you could get it done for quite a bit less.

The plus ferilizer and rent part was meant as a yearly cost. I see alot of people that dont figure their land use cost in. In my opinion at least, if you can get $150/ac cash rent, that needs to ba taken into consideration somewhere. Your break even cost could be figured as your ammorized land cost + interest & tax, but if you cant profit more/ac then you caould get for cash rent is it really worth the hassel? Or are you better off renting it, or planting row crops & relaxing during the summer?

#11 swmnhay

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Posted 11 November 2011 - 06:42 AM

That $400/ac is a number that I have seen thrown around here quite a bit, and it makes sense to me when you figure in all the cost to plant.

$100/ac for seed
$100-150 for initial fertilizer application, maybe even more depending on the soil
$50/ac for lime, applied
labor, fuel, and machinery to till and seed, or burndown and no-till

Plus just getting stated he would be hiring the burn down, and renting a no-till drill, or buying one. If conventional tillage he would also need to rent/buy tillage equipment, or just hire it all out. Either way, I think $400 is close. Now for someone with an established farm and equipment, you could get it done for quite a bit less.

The plus ferilizer and rent part was meant as a yearly cost. I see alot of people that dont figure their land use cost in. In my opinion at least, if you can get $150/ac cash rent, that needs to ba taken into consideration somewhere. Your break even cost could be figured as your ammorized land cost + interest & tax, but if you cant profit more/ac then you caould get for cash rent is it really worth the hassel? Or are you better off renting it, or planting row crops & relaxing during the summer?


Yep $400 would be a pretty close figure then for establisment.

But in all fairness seed and lime should be prorated for life of the stand to figure an annual cost.

#12 Fowllife

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Posted 11 November 2011 - 08:01 AM

Yep $400 would be a pretty close figure then for establisment.

But in all fairness seed and lime should be prorated for life of the stand to figure an annual cost.


Yes it should. All of the equipment should also be pro rated also to be fair. That spread sheet does a really good job figuring true cost over the life of a stand. You can even adjust your yield, selling price, and stand life to find your break even/ profit point. IMO it;s very helpfull for someone getting started, or an established producer for a double check.

In the long run there is money to be made here, I was just trying to also point out that there will be a chunk of change required to get it started all at once.

#13 somedevildawg

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Posted 13 November 2011 - 10:43 PM

Better think carefully about this decision, all very good advice, the bottom line is, get your pocket book ready because you are fixing to spend some serious money and believe me you will make some bad investments in equipment before it's all said and done, more money. Start smaller, learn the ropes, a 50 acre field here in the south would cost me approx $24,000 in fert. Herbicides, lime, etc. Out of pocket type money, not including equipment, at that rate you would have to sell 10,000 bales at $4 just to break even on those out of pocket expenses and fossil fuel, better have a good baler, and a bunch of labor, you know how many hours you are looking at to harvest 50 acres, start with 10 acres rent out the rest, you'll be glad you did.

#14 Josh in WNY

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Posted 15 November 2011 - 01:47 PM

Glad to see there are still people out there looking to get into farming, I've seen too many folks in my area getting out for one reason or another. I am located out in the western end of New York, near Lake Erie. The number of cuttings of hay you will get each year will depend on the type of hay you are growing. I grow a timothy/grass hay and only get 2 cuttings due to the longer time between cuttings. If you are going to do an alfalfa hay, you could get 3 or 4 cuttings, but it tends to be really hard to get alfalfa dry enough to bale for hay in this climate. I only sell a little hay locally, but if you have good stuff, $3.00 a bale (small square) wouldn't be out of the question, especially if you are closer to New York City.

As for the cost of shipping, I have shipped tractor trailer loads of hay (again, small squares) into New York City, Rhode Island and that area for $1,200 to $1,500, but that was a couple years ago. I sell most of my hay to Florida by the tractor trailer load and the shipping is running around $2,500 to $3,000 depending on where you are shipping to. I grew up working hay on the family farm, so I didn't have to worry about buying equipment other than what I wanted to add or replace. My advise on equipment would be to take a look at how you intend to handle the hay from cutting all the way to selling and figure out what set-up works best for you. I have gone to using a New Holland stacker wagon and am going to be getting a bale grap to use for loading trailers soon. Don't count out using an accumulator and graple or even going with kicker rack wagons if you have a cheap labor source nearby. If you choose to do round bales, you probably won't make as much money per ton a hay, but your equipment cost might be lower and your labor would be lower for sure.

I know I've gone on long enough here, but I'll give one last bit of advice... know what your market is before you spend a penny! If you are going after the horse market, you'll probably want to do small squares, if it's the dairy market, you'll probably want to do rounds.

Feel free to shoot me a message on here if you want to talk more.

Edited by Josh in WNY, 15 November 2011 - 01:50 PM.
stupid grammar mistakes, my mom would be unhappy.


#15 hay wilson in TX

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Posted 15 November 2011 - 07:58 PM

All farming is capital intensive and can be labor intensive.

There is a reason for farms continuing to become larger. The larger the capital investment usually the equipment cost per acre will decrease

IF forages are your desire then the most efficient method to harvest forages is with grazing animals.
The reason we feed harvested and stored forages is a lack of available grazing.

I use all older to real old equipment on a small hay farm. If I had a moderately large farm I could justify newer and larger equipment, plus be more effecient.

You will probably not be able to compete with the large Western Hay Growers on Price. Being in the Humid East You will find it difficult to compete with the large Western Hay Growers on Quality.
Your advantage is the cost to ship hay 1,000 miles will be your competive advantage.
You will be able to sell for less than the Feed stores, but more than truck load lots.
99.99% of my has goes off the farm in a pickup truck or a 16 foot long truck pulled trailer.
For this market you must have hay storage. With out hay storage you are at the other fellow mercy.
Your customers will not have enough storage to feed hay all winter.

The disadvantage with being part time is hay production is a full time job. You need to rake the hay when the hay is ready, and you need to bale the hay when the hay is for sure ready. Then you really need to get the hay under cover.

You may find you NEED to have your hay custom harvested.
You may need hired help to put the hay under cover.

That will eat into your profits but may be your better option.

#16 Armfelt-Ohio

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Posted 21 November 2011 - 12:35 PM

i figured up shipping for square bales from ohio to texas and it came out to be about $3 a bale in frieght. i ended up contacting a broker down there and he set up shipping arangements but witht the drought still came out ahead.




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