Re: Starting a Grain Hauling business

Posted by JD Seller on November 10, 2016 at 17:20:38 from (208.126.198.123):

In Reply to: Starting a Grain Hauling business posted by Hogleg on November 10, 2016 at 05:20:48:

I would sternly recommend NOT trying to make a living hauling grain, at least in this area. I can get grain hauled, out of the harvest season, cheaper than I can do it with my own truck(s). It seems every farmer and part time farmer wants to be in the grain hauling business. They see freight charges of $.20-30 per bushel and think that the trucker is getting rich. So they go out an buy a semi and hopper trailer. They borrow the money with their farm operating loan and then depreciate it under their schedule "F". Then they run farm tags even though they are hauling for hire. Few of them actually know the true cost of operation as they write all the cost off against their farming operation. So they look at any grain they haul in the off season as gravy profit.

An example of this: Right now hauling grain to ADM at Clinton Iowa from here, runs around $.25 per bushel. Starting in Jan. I have corn contracted to be hauled for $.12 as a back haul for two farmers picking up gluten feed at Clinton. So if you can legally haul 1000 bushels at $.25 that would be $250 for a 150 mile trip. About a $1.66 per running mile or $3.33 a loaded mile. That is a fair rate for both parties. Now figure the $.12 per bushel rate. That is only $120 for a 75 mile trip. That is a $1.66 per loaded mile rate. NOT GOOD at all. With the feed coming back it make them a little bit but the fuel burned and the wait in line negate much of a profit.

I know of many that have thought hauling grain would be the berries, 99% of them lost their shirt. The first time the truck needed new tires or a engine/transmission overhaul they were out of business. Even just paying their income tax at year end rather than having it deducted weekly sinks many of them. They look at the GROSS check compared to a forty hour weekly pay check and think their are getting rich. Many do not think of the total cost of owning/running a truck. Fuel and tires are only a part of the total cost.

IF they do not have outside income I do not see it ever working. There will be too many zero months to keep their heads above water.

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