Whiteboard Chat: Cow Herd Profitability

What is the cost of adding a cow to your herd? Post Rock Extension District Livestock Agent Barrett Simon discusses factors in determining cow herd profitability. Learn more at www.postrock.ksu.edu

[@brettbickham9579]

Well done!

[@jmfarms3555]

Depreciation is irrelevant. What matters is cash flow. Using the truck example. The truck cost $30000 but you pay for it over a 5 year term. So for 5 years that truck costs the operation $6000 per year. If you don't have the $6000/year to pay for the truck with the cash flow from the operation , that truck will be taken away.

[@PostRockExtension]

We appreciate your comment.

[@dojoparsnip9905]

why is the truck bring taken?

[@jmfarms3555]

@@dojoparsnip9905 if you don't make your payments the truck will be repossessed.

[@dojoparsnip9905]

@@jmfarms3555 lol. you worded that so oddly. but also what about the subsequent years when it is paid off? now you dont owe $6000 a year. or during use, you depreciate it to lower your taxes. Use the offset for your balance.

[@niemdan]

Whatever price you get out of the cow when she’s culled, is typically close to the profit margin over her life

[@vandrex01]

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[@vicvic1595]

Any useful tips on how you got this successful?