Quote:
Originally Posted by #-3
I do sometime wonder about this one, it's a pretty common message that's out there, but I know some pretty wealthy cattle farmers. Not really a question I've ever asked or one I have cared too deeply about, they are in an industry with enough competition, and if they can make money at it good on them.
But it always seems to be the guy driving around in a $120K truck, sitting on millions of dollars of property and blowing thousands at charity auctions that cries poverty the loudest. Some times it makes me wonder.
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There are some pretty wealthy farmers in general, I would agree with you - and we have a tendency that things are never perfect enough
. I would say the majority of us however are surviving at best in the cattle industry.
As a producer, there hasn't been a lot of financial gain, and when you add in the last 5-10 years worth of drought in SE Alberta - things are rather bleak. The government program last year helped, absolutely, but for us in SE Alberta, this hasn't been a one year thing - and the only relief we've gotten until last year, is income deferral if we had to sell cows. Doesn't replace income, doesn't pay expenses as the hope is eventually you can use that money to replace the cows you were forced to sell.
Last year we paid close to 80K in replacement feed costs due to drought (38% of our farm income), and that was relying on some carry over from '20 which was a pretty good year for us. Our choice, we could have downsized - maybe chose wrong, I don't know, question it every day.
This year, we have no feed reserves going into this winter, we have gotten 3/10 of rain all year, the cost of all inputs has at least doubled from last year - fortunately we haven't gotten the heat from last year, but you can see the grass starting to turn over the last week.
It is shaping up to be another year like last, if not worse based on all the expenses going wild. None of us want to be a leech on financial aid, but when your expenses have 3-4x over the last decade and your calf is still worth the same as it was 10 years ago - the game becomes a difficult one to play without rain. We aren't like grain farmers and put our calves in a bin until the price is right - they animals have to go and we often times just have to take what the market says they're worth. And we can't raise more of them on the same land base in these conditions.
This is not a poor me post, we chose the life - but it is a glimpse in that the industry is in trouble as my story is probably more common than the people you mentioned above. Some will make it through, but there will be a bunch that a) can't or b) choose not to.
There was an article in the Western Producer that said packers/retail are making about $300/head each, while feedlots/producers are each losing roughly the same dollar figure. Our '21 loss wasn't that high, but the system is broken, and I honestly don't know what can be done to fix it.