Episode Details

Introduction (Recording 9/14) (Airing 10/4)

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helping the farming be more organized with record keeping

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Main topic – Breaking down the value of contract raising livestock.

• Guest – Travis from Circle “U” Farms
  • Cattle and poultry farmer who is here today to help us provide an episode with straight forward information around custom raising livestock.
  • Where do you farm and tell us a little about yourself Travis!
  • 
     
• Definition of contract growing livestock or custom raising livestock.
  • Production contracts specify services provided by a farmer for a contractor who owns the commodity while it is being produced. The contract covers (1) the services provided by the farmer, (2) the way the farmer is to be compensated for the services, and (3) the specific contractor responsibilities for provision of inputs. For example, farmers provide labor, housing, and equipment under livestock and poultry production contracts, while contractors provide such other inputs as feed, veterinary and livestock transportation services, and young animals.”
• Livestock Integrator
  • Owner of the livestock placed for custom raising
• Today we will try to provide perspective from 3 types of livestock.
  • Corey/Tanner – Pigs
  • Tanner/David – Cattle
  • Travis – Poultry
• What does it take to get started?
  • Facilities
    • Size of building, amount of land
    • Costs to build or remodel
    • Ongoing maintenance
    • Storing Feed
  • Labor
    • Tasks frequently done
    • Hired?
    • Contractors?
    • Regular Hours?
  • Equipment
    • Tractor
    • Mower
    • Handling
    • Etc….
  • Contract
    • How do we get paid?
    • What are normal expectations?
      • Farmers Responsibilities
      • Integrators Responsibilities 
    • Length?
      • Flock by flock, group by group, years
• Is it profitable?
  • Hogs
  • Cattle
  • Poultry - Depending on the size of bird produced, five to seven flocks per year may be grown per house with flock sizes ranging between 22,000 and 26,000. Gross income per house will generally range from $28,000 to $35,000 annually. Thus, net returns per house are generally minimal ($3,000 to $10,000) during the 10- to 15-year payback period. Returns per house are much more substantial once the house is paid for.
• Advantages
  • Reduced management responsibilities.
    • Still requires intense herd/flock management & record keeping, but less accounting
  • Less risk for production and less risk for loss of income
    • Also limits upside potential – poultry gets bonuses
  • Relatively fixed income; some insulation from price changes.
    • Utilities, fuel, labor, etc….not fixed costs
  • Less operating capital necessary
    • Still requires substantial