| The implications of an aging farmer population in the U.S. have been the topic of much debate. This issue begs the question: who will be responsible for the future of production agriculture in the U.S.? In Oklahoma, the beef industry is central to the discussion since it is consistently the number one ranked commodity in the state. While recent drought has led to declining herd numbers, favorable prices may lead to herd rebuilding when drought conditions improve. How will young and beginning producers fare in taking part in the rebuilding process? This research uses Integrated Farm Financial Statements (IFFS) to project farm plans for a native pasture forage base and an introduced (Bermuda/fescue) pasture forage base. Scenarios were analyzed for purchasing cows with loans from a commercial lender and an FSA direct operating loan. In addition, a leasing agreement between a beginning and retiring producer to transition the ownership of cows was analyzed. Also a summer stocker enterprise was evaluated as an alternative to the cow-calf enterprise. Finally, the feasibility of purchasing the land base was analyzed. Results showed leasing native pasture appeared to be the most feasible path for beginning producers given the lower operating costs. The terms of the FSA direct operating loan improved cash flow substantially compared to the commercial loan terms. The application of nitrogen fertilizer increased the operating costs for the introduced pasture and servicing any debt appeared in feasible. Leasing cows may provide an alternative way for young and beginning producers to gain access to assets without the burden of large debt loads. A summer stocker enterprise may generate cash to purchase assets and provide higher returns to labor, but may expose the young producer to an unwanted amount of risk. Purchasing pasture will likely be difficult for the young and beginning producer even with the favorable terms of the FSA loans targeted to beginning farmers. |
