harris25
Member
Thinking about getting some cows on shares. Wondering what the different types of arrangements are and if it is worth it?
Cows on Shares
- Thread starter harris25
- Start date
It can work for all parties, just make sure you have a written contract. We have shared cows out and been burned pretty badly even with a contract in place, but I think these type of arrangements still have their place.
Some take a smaller percentage but require replacements, others charge a larger percentage or $ fee but don't require replacements or even provide replacements.
I would ask that all cows are confirmed pregnant before delivery (or depending on season come with a calf at foot).
Some take a smaller percentage but require replacements, others charge a larger percentage or $ fee but don't require replacements or even provide replacements.
I would ask that all cows are confirmed pregnant before delivery (or depending on season come with a calf at foot).
Justin
Well-known member
i wouldn't do it. it's pretty damn tough to make money on share cows. if you are needing cows, i'd just go buy them. or, how about selling the hay or leasing out your grass?
Faster horses
Well-known member
:agree:
About the best it can be, seems to me, is a short-term
solution for a long-term problem.
About the best it can be, seems to me, is a short-term
solution for a long-term problem.
GM88
Well-known member
First post. Have had share cows on different deals and it dont work. One person can hardly make a living on a cow let alone 2.
Faster horses
Well-known member
Welcome to ranchers, GM88.
Frank in West Dakota
Well-known member
- Joined
- Apr 3, 2006
- Messages
- 263
There's lots of different scenario's to work a share deal.
And yes, they can work.
I have share cattle from 3 different owners. They're happy just to have some cows. I'm happy just to have those cows.
It's win/win for this operation, but I won't run share cattle forever!
And yes, they can work.
I have share cattle from 3 different owners. They're happy just to have some cows. I'm happy just to have those cows.
It's win/win for this operation, but I won't run share cattle forever!
oldblood
Well-known member
Haveing cattle on shares is the highest interest rate you will ever pay. even if you do 40/60% you are paying 40% interest. You are better off renting out your pasture. But if you want to do shares I will sent you all the cows you want. The guys I know that make the most money on cattle are the guys with cash in hand, buying cows & sending them to someone on shares. They are getting obout a 30% return on investment in 6 to 9 months, without death lost.
oldblood said:
I know a guy who puts them out on a yearly basis I'd bet a million all those cheap cows he bought last fall will get cashed out this fall.Imagine the money he'll make on the % of calf crop then the increase in cow value.
Northern Rancher
Well-known member
There's a couple outfits have a few thousand cows out at any one time-it must be working for them as they keeep expanding. Some kids take the parents cows on shares for a few years as they phase into retirement. I guess it is as good a deal as you make it sometimes bankers aren't exactly twisting your arm to give out cow loans usually it's right at the point in the cycle they should be.
Justin
Well-known member
Northern Rancher said:
there is a differnce between taking in share cows and putting out share cows. the guy that puts the cows out on shares is gonna be way better off than the guy taking them in. IMO
i'm sticking to my guns.......no share cows! :wink:
Northern Rancher
Well-known member
There are alot of guys got their start in the cattle business on share cows and went on from there-they can work if you aren't that fond of bankers or vice versa. We've had a couple sets over the years not any great numbers but they worked for the particular situations. I'd cash lease cows before calf share them though.
We ran some registered cows some years back for some people that wanted in the registered business and had bought some cows but had no place to run them. Come fall we split the calves and we got most of the good ones from the old cows as all they knew is they wanted the ones with the highest EPD's. :shock:
randiliana
Well-known member
Well, I don't really know if Share cows really are all that bad. A lot depends on your exact deal. BUT, if you actually put it to paper....
If you buy 10 cows at $1000 each and take a loan out to pay them off over 5 years.
Your principal payment is going to be $2000 and if I figured it right your interest will be say $500. So, that is a $2500 total payment.
Now, if you take cows on shares, with a 60/40 split. Say your calves average $500 (which they have around here the last couple years). So, those calves bring in $5000. 40% of that is $2000.
Now, that is certainly not as much as if you were paying that loan out.
Plus, you have to figure that you are going to have to cull and replace some cows.
When you own them, that is all going to come out of your own pocket.
When we've had share cattle, replacements were the responsibility of the owner, and we got back BRED cows. If a cow died, we had the vet post them, just to cover our butts, and so long as she didn't die from negligence (read starvation etc) the owners also replaced her.
We've also done it on a lease basis, where we paid the owner a set amount every year. Usually that works out to about whatever the payment would have been per cow if you had bought them on a 5 year loan, or maybe a bit less.
Some other things to think about with a cow share/lease agreement are
-who supplies bulls
-who pays med./vet costs
We've had them both ways as far as bulls go. We've supplied and the owners have supplied. If you want to keep heifers, then probably you want to choose your own bulls, if the calves are all being sold, maybe it doesn't matter so much.
All the agreements we've had, vet costs were ours, but I have heard agreements where the owner shared in vet costs.
Whatever the case, I would insist that the cows need to be pregchecked at the owners expense or have a calf at foot before they arrive at your farm.
If you buy 10 cows at $1000 each and take a loan out to pay them off over 5 years.
Your principal payment is going to be $2000 and if I figured it right your interest will be say $500. So, that is a $2500 total payment.
Now, if you take cows on shares, with a 60/40 split. Say your calves average $500 (which they have around here the last couple years). So, those calves bring in $5000. 40% of that is $2000.
Now, that is certainly not as much as if you were paying that loan out.
Plus, you have to figure that you are going to have to cull and replace some cows.
When you own them, that is all going to come out of your own pocket.
When we've had share cattle, replacements were the responsibility of the owner, and we got back BRED cows. If a cow died, we had the vet post them, just to cover our butts, and so long as she didn't die from negligence (read starvation etc) the owners also replaced her.
We've also done it on a lease basis, where we paid the owner a set amount every year. Usually that works out to about whatever the payment would have been per cow if you had bought them on a 5 year loan, or maybe a bit less.
Some other things to think about with a cow share/lease agreement are
-who supplies bulls
-who pays med./vet costs
We've had them both ways as far as bulls go. We've supplied and the owners have supplied. If you want to keep heifers, then probably you want to choose your own bulls, if the calves are all being sold, maybe it doesn't matter so much.
All the agreements we've had, vet costs were ours, but I have heard agreements where the owner shared in vet costs.
Whatever the case, I would insist that the cows need to be pregchecked at the owners expense or have a calf at foot before they arrive at your farm.
Faster horses
Well-known member
We have some friends who have a registered Red Angus herd of
top cows. They went to a share deal. The foreman of the ranch
was a great guy, good caretaker, etc. Well, he left (I don't know
why) and when our friends went to see how the cows were doing
the second winter, it was a full-fledged WRECK. The cows were
die thin, they were on a blowed out ridge being fed straw!!!
It took a COURT ORDER to get their cows back.
What I'm saying is situations change. And when you are not in
control of your own cattle, anything can (and will) happen.
This is besides the economics of the deal. Sometimes share
deals between friends can ruin a friendship.
Lots of things to think about running share cattle. We tried it once...
we put the cows out on shares. It didn't work. They marketed their
cattle differently than we did. Our order buyer would have taken those
calves along with ours (and we were paid the highest price of anyone
that particular year). Mr. FH didn't want to ask the folks running the cows
to gather ours to sell to the order buyer. These people, at that
time, marketed their cattle in Nebraska through a sale ring. We loaded
them in SW Montana on Nov. 4th in below zero temperatures and a snow storm.
They got hit with a big snow storm in Nebraska
when they were unloaded.
The calves were weighed before they left, to get a weight. The
shrinkage was a killer...and the market had dropped besides.
That was a real lesson for us. We sold the cows and vowed to never
try that again. So many things to consider besides the percentage,
replacements and bulls. FWIW
top cows. They went to a share deal. The foreman of the ranch
was a great guy, good caretaker, etc. Well, he left (I don't know
why) and when our friends went to see how the cows were doing
the second winter, it was a full-fledged WRECK. The cows were
die thin, they were on a blowed out ridge being fed straw!!!
It took a COURT ORDER to get their cows back.
What I'm saying is situations change. And when you are not in
control of your own cattle, anything can (and will) happen.
This is besides the economics of the deal. Sometimes share
deals between friends can ruin a friendship.
Lots of things to think about running share cattle. We tried it once...
we put the cows out on shares. It didn't work. They marketed their
cattle differently than we did. Our order buyer would have taken those
calves along with ours (and we were paid the highest price of anyone
that particular year). Mr. FH didn't want to ask the folks running the cows
to gather ours to sell to the order buyer. These people, at that
time, marketed their cattle in Nebraska through a sale ring. We loaded
them in SW Montana on Nov. 4th in below zero temperatures and a snow storm.
They got hit with a big snow storm in Nebraska
when they were unloaded.
The calves were weighed before they left, to get a weight. The
shrinkage was a killer...and the market had dropped besides.
That was a real lesson for us. We sold the cows and vowed to never
try that again. So many things to consider besides the percentage,
replacements and bulls. FWIW
Interesting observations FH.
While I admittedly haven't got a complete grip on how cow sharing works, the gears are turning as it reltates to my place.
I'm quickly arriving at a point where I'll have plenty enough feed to cover my own animals during the dry season. If I've got extra feed my options are to sell it outright, or perhaps take on someone else's cattle for a number of months.
Personally, I'd not send my own animals anywhere else but would accept animals of others if the deal was good for both sides. I don't know of anyone doing such deals down here, or even if the locals would go for such a plan, but it's worth exploring.
Many producers, through poor planning or just bad luck find themselves either selling a portion of their herd just to make it through our local summer or just watching some of their older cattle die. Perhaps if they could send a number of pregnant cows my way for a few months and then see them returned fat and happy (minus some calves, of course), a deal could be done.
Again, just thinking about possibilities.
While I admittedly haven't got a complete grip on how cow sharing works, the gears are turning as it reltates to my place.
I'm quickly arriving at a point where I'll have plenty enough feed to cover my own animals during the dry season. If I've got extra feed my options are to sell it outright, or perhaps take on someone else's cattle for a number of months.
Personally, I'd not send my own animals anywhere else but would accept animals of others if the deal was good for both sides. I don't know of anyone doing such deals down here, or even if the locals would go for such a plan, but it's worth exploring.
Many producers, through poor planning or just bad luck find themselves either selling a portion of their herd just to make it through our local summer or just watching some of their older cattle die. Perhaps if they could send a number of pregnant cows my way for a few months and then see them returned fat and happy (minus some calves, of course), a deal could be done.
Again, just thinking about possibilities.
Big Muddy rancher
Well-known member
oldblood said:
If you take $1,200 dollar cow and take 40% of a $500 calf you have $200 dollars. If the owner is taking all the risk on those cattle, supplying replacements and selling his initial investment for less then half of what he had in it or possibly losing it all then "40%" isn't that high.
Faster horses
Well-known member
Whitewing, the idea of renting out extra grass appeals to me moreso
than running cows on shares.
However, I have listened to self-made successful ranchers and it
is their opinion that you can graze someone else's pasture cheaper
than you can graze your own. Rent theirs and in a drought year or a
year of other
unfortunate circumstances, use your own grass that has been SAVED
or grazed after the growing season.
That's just something to keep in the back of your mind. I had never
thought of this before, but they were adament about it. Even
just renting SOME extra grass and saving some of theirs was
an idea they used successfully. Again, FWIW, and I'm sure some
here won't agree with what I have just posted. I am just repeating
as food for thought. Besides, I'm sure your pasture conditions are different than ours.
than running cows on shares.
However, I have listened to self-made successful ranchers and it
is their opinion that you can graze someone else's pasture cheaper
than you can graze your own. Rent theirs and in a drought year or a
year of other
unfortunate circumstances, use your own grass that has been SAVED
or grazed after the growing season.
That's just something to keep in the back of your mind. I had never
thought of this before, but they were adament about it. Even
just renting SOME extra grass and saving some of theirs was
an idea they used successfully. Again, FWIW, and I'm sure some
here won't agree with what I have just posted. I am just repeating
as food for thought. Besides, I'm sure your pasture conditions are different than ours.
