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I want to start a business of dairy farming and dairy products in my area. Is there an organization that can guide me on this? Is this a good step to start this business? What is the relationship between success and failure in this area? because I really want to invest as a starter without risk.

2 Thoughts on As farm businesses?
  1. Reply
    Rob
    August 26, 2013 at 5:28 am

    do have a full time job to support
    u 1st 1-2 yrs.

    sorry any every ‘invest’ has risks.

    u need to check your states agriculture
    food laws b4 spending one penny.

    u may even need city permits plus
    dozens of other things.

    success/failure rate is 95% fail in 1st
    5yrs often with 10,000s$ debt.

  2. Reply
    Andrew Strauss
    August 26, 2013 at 5:49 am

    You can start business like:

    Acquiring Farmland: The most difficult aspect of starting a farm business is acquiring vacant farmland on which to plant crops or raise farm animals. Vacant farmland with enough contiguous acres to run a farm business is getting more difficult to find as suburbs spread out to the countryside. Farmland is extremely expensive, especially when you look at the return on investment (ROI) that you can expect per acre when planting crops. Here is a realistic example for understanding ROI with a farm business. If you plant soybeans, and you make $ 400 per acre each year after deducting planting and harvesting expenses on the sale of your crop, and you paid $ 5,000 per acre for the land, it will take you over 12 years just to make enough profit to pay for the land. Land is not a depreciable asset for income tax purposes, so the cost does not reduce your taxes. However, interest paid on farmland is fully deductible, as are the property taxes. Most banks require buyers of vacant farmland to have at least 30 percent of the purchase price as a down payment. Therefore, to purchase 100 acres at $ 5,000 an acre, you would need $ 150,000 down just to buy the land, without any machinery to run it. On top of that, the interest rates are higher on vacant land than home mortgage rates.

    Machinery: Running a farm business requires a large capital investment, first for the land, then for the machinery. First, you need a big tractor and wagons. Then if you are crop farming, you need a planter, sprayer, combine and wagons. If you are raising hay, you need a mower, conditioner, rake and a baler. If you are raising animals, you need fencing, automatic waterers, barns, skid steer and a manure spreader. You may also need other equipment specific to the types of farm animals you intend to raise or specific to the type of crops you intend to plant. Chances are you will need to approach a farm credit service organization to obtain financing for startup farm equipment, as most financial institutions require regular monthly payments, as well as down payments on each item. A farm specific financial institution will allow you to make a large payment, once a year, after you harvest your crops.

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