Field Notes Blog > 2014 > How Can a Young Person Get Started in Agriculture Today

  • How Can a Young Person Get Started in Agriculture Today

    January 04, 2019

    This is a question I receive at least once a month. I believe that answer is always changing as new ideas and methods are derived..

    However, most commonly, a young person starts by working for a current farmer, learning the ropes, researching his/her area of interest, writing a business plan and executing the plan. That’s the short answer, and I have some examples and ideas below. These ideas are not all inclusive by any means; they are just a few of the ones I have seen work in the past.

    I’ll start with a dairy farm example. How can a young person get started in such a capital intensive business? As I mentioned above experience and education are keys to success. You must get as much knowledge and experience as you can before investing your money. Yes, that’s right - before investing your money. This implies that you work somewhere to create enough savings to cover the down payment on a new venture. Education comes in many forms, and oftentimes work experience on a successful farm is a great place to start. I know a farmer who told his son coming out of college to go work on another dairy for a few years before coming home to the family farm. When asked why, he stated that the son will not only learn different management styles but also be able to make mistakes on the other farm’s dollar! He was kidding, but in reality who doesn’t make a mistake or two as they learn, so his statement holds a lot of truth.

    While working and learning on the job you can pay off college debt and save some money to put yourself in a position to invest in your dream. I know the chances of saving enough for much of a down payment while working are small. This has led to many successful farmers offering key employees the opportunity to gain equity in the farm by being paid in calves on a performance-based employment contract or just as a part of a wage. Once you have built up a small herd, you can use the equity to purchase additional animals and begin farming on your own by renting a facility. Perhaps the established farmer is open to allowing you to keep the cattle on his farm and receive a percentage of the milk check equivalent to his ownership of the cows. I have seen this work as a transition plan for the established farmer also.

    The bottom line is to first invest in assets that will generate revenue. This is the cows in the case of a dairy farm. Starting out you will need to rent a farm or space in an existing dairy until you have gained enough equity and grown to the point that you can afford to purchase your own farm.

    That is one method to get started, and as I stated earlier there are many others. A crop farmer can start much the same way. You can work for an existing farmer to gain experience and knowledge and then begin to rent some land on your own and either hire custom planting and harvesting services or rent the equipment from a dealer or another farmer to operate the farm. A crop farmer I knew allowed his employee to rent some of the farm he was operating and the farmer provided equipment to operate the farm. The farmer was paid by a crop share arrangement. The employee did the work on these acres on his days off and evenings after work. He financed the inputs with his cash and an operating line of credit.

    The ideas I presented here today are very general. You must research proposals thoroughly and have detailed contracts with the existing farmer so both parties fully understand what is expected of each other. It can also be expected that you work on the farm for a year to be sure that your personalities match before entering a contract situation. AgChoice Farm Credit has consultants on staff who can help you put together this type or other types of arrangements. We also offer AgBiz Masters that is a great education program to help you create your business plan. The business plan can be the basis of the working relationship with an established farmer.

    Don’t let the overwhelming price of beginning a farm stop you. If you do your homework, ask questions, save your money and work hard, you can be successful, and AgChoice is here to help.

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