Family Tradition
Well-known member
I've never done this before so I wanted ya'lls thoughts on letting someone place stockers on your pasture and get paid for the gain. Sounds good would like to hear pros & cons & prices. TIA
Raising stockers on the gain
- Thread starter Family Tradition
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I'm assuming by gain, you're referring to weight -- not profit.. Otherwise, they could just turn your grass into enough cash to buy stuff they needed, then say "Sorry, we only broke even this year."
But even if we're talking weight, you're still at the mercy of someone else's talent for raising cattle and/or making good business decisions... Think about this: If you had enough calves that you could split them between two locations, and if one of those locations was willing to accept payment based on weight gain, would you send your best or worst gainers to the other place? If it were me, I'd maximize profit by sending my worst so the final bill would be lower, and I'd let my best graze the "free" grass at my own place...
Instead, why not shift the risk to the producer -- where it belongs -- by setting a fair price and leasing it out? That way, if someone with no-good stockers comes along and eats all your grass for naught, you still get paid and he takes the loss for choosing no-good stockers.
But even if we're talking weight, you're still at the mercy of someone else's talent for raising cattle and/or making good business decisions... Think about this: If you had enough calves that you could split them between two locations, and if one of those locations was willing to accept payment based on weight gain, would you send your best or worst gainers to the other place? If it were me, I'd maximize profit by sending my worst so the final bill would be lower, and I'd let my best graze the "free" grass at my own place...
Instead, why not shift the risk to the producer -- where it belongs -- by setting a fair price and leasing it out? That way, if someone with no-good stockers comes along and eats all your grass for naught, you still get paid and he takes the loss for choosing no-good stockers.
Family Tradition
Well-known member
Good thoughts now you got me thinking. Yes I'm talking weight gain. What kind of money are we talking about for Lb. of gain?
Family Tradition":265hysjf said:
They pay .40 to .50 cents per lb. of gain here.
They allow only a small percentage of deaths, then the overall weight deductions start taking from your pocket.
Genetics can play a big part in whether you make or lose money.
Don't allow a bunch of scrubs.
I have done it when I had extra pastures and grass. Sometimes you win, sometimes you lose.
Dave
Well-known member
I have never done this but I have a good friend who does. The advantage is that you don't have money invested in cattle. If the market goes down it doesn't hurt you.
The disadvantage is you just get paid on the gain. Slow growing or sick cattle you don't lose money on the cattle but you lose the oppurtunity. Locally they have been paying about 40 cents a pound for the gain. If you own the stockers that pound is certainly worth more than 40 cents. You have to do a real good job of grazing to get a 2 pound per head per day average. When pushing the pencil on this I would figure closer to a 1.5 pound per day average.
Again speaking locally most of the cattle on this type of deal come from the large feedlots. They own thousands of cattle so getting poor cattle is a little less likely but it does happen. On an up note with the price of gain being so high in feedlots now, there may be more chances to do this and the rates should be going up.
The disadvantage is you just get paid on the gain. Slow growing or sick cattle you don't lose money on the cattle but you lose the oppurtunity. Locally they have been paying about 40 cents a pound for the gain. If you own the stockers that pound is certainly worth more than 40 cents. You have to do a real good job of grazing to get a 2 pound per head per day average. When pushing the pencil on this I would figure closer to a 1.5 pound per day average.
Again speaking locally most of the cattle on this type of deal come from the large feedlots. They own thousands of cattle so getting poor cattle is a little less likely but it does happen. On an up note with the price of gain being so high in feedlots now, there may be more chances to do this and the rates should be going up.
If you lease it, you won't have to figure any of that out.. All you'll have to do is figure out a lease rate.
By the by, what happens if you let someone else's stockers graze you to the roots on a gain-sharing agreement and then, just as they were finishing up, OOPS! -- renter must have "accidentally" left the gate open and all those calves just up and disappeared into thin air.. Now they weigh zero pounds.. Seems to me you'd pretty much be SOL..
What if somebody puts, say, 50 stockers out there, and five of them bite the dust at some point... Do you get paid on the final weight difference between the remaining 45 finished steers and 50 starter stockers, or is the beginning weight of the five starters deducted from the total weight of the 50?
But, what if they died halfway through... Actually, what if they died on the truck? Did they eat all summer on your dime, or do they get deducted? Is it a pro-rated deduction, based on what you think they would have weighed at the time of their death?
The more I think about it, the more wrenches I can think up to throw in and screw this agreement six ways to Sunday...
I'd lease it, plain and simple..
By the by, what happens if you let someone else's stockers graze you to the roots on a gain-sharing agreement and then, just as they were finishing up, OOPS! -- renter must have "accidentally" left the gate open and all those calves just up and disappeared into thin air.. Now they weigh zero pounds.. Seems to me you'd pretty much be SOL..
What if somebody puts, say, 50 stockers out there, and five of them bite the dust at some point... Do you get paid on the final weight difference between the remaining 45 finished steers and 50 starter stockers, or is the beginning weight of the five starters deducted from the total weight of the 50?
But, what if they died halfway through... Actually, what if they died on the truck? Did they eat all summer on your dime, or do they get deducted? Is it a pro-rated deduction, based on what you think they would have weighed at the time of their death?
The more I think about it, the more wrenches I can think up to throw in and screw this agreement six ways to Sunday...
I'd lease it, plain and simple..
Dave
Well-known member
As opposed to renting or leasing out your pasture, with a rate of gain you are managing both the cattle and the pasture. Plenty of renters graze to the roots but it is doubtful you would do it to yourself. The grazing contacts I have seen have a mortality clause. That spells out how much mortality lose is the responsibility of the cattle owner and it is the first 2 or 3% that is their responsibility. They are also weight in and weight out at the closes weighing point to your farm with no shrink. The contracts also stipulate the vaccination program for the cattle and an intelligent producer is going to make sure they are vaccinated properly for everything under the sun.
Grazing on the rate of gain is actually a good way to minimize risk. Of course by minimizing risk you are also limiting reward. It is also a good way to get into cattle with a limited investment.
Grazing on the rate of gain is actually a good way to minimize risk. Of course by minimizing risk you are also limiting reward. It is also a good way to get into cattle with a limited investment.
Family Tradition
Well-known member
Wow ya'll have certainly thrown a lot out there to think about. I was approached last evening about this and hadn't thought about it til then. So I thank you for the comments and suggestions. Any other input will be gratefully appreciated.
Thanks
Thanks
Are the calves weaned,worked and preconditioned?
Straight off momma?
Not worked up- and you have to do it? Who pays for it?
Grouped from salebarns?
What are the In wts?
How long are you gonna keep them?
Are you going to have to supplement feed? Or.....What kind of grass do you have to graze?
Are your fences good?
Do you have the time and knowhow to treat calves?
Who pays for medicine?
What are the deathloss arrangements?
And I second the question--- are final wts with the deads in or out?
Some calves/arrangements would be a good deal at .40/lb
Some calves and arrangements wouldn't be a good deal at .60/lb
And you risk the work and effort and making nothing on some calves and arrangements no matter what you agree to be paid /lb. A train wreck can work you to death and end up costing you money.
This is a classic scheme(con) too-- you may not get paid at all.
know what you are getting into or i second the opinion that renting is a much better option.
Straight off momma?
Not worked up- and you have to do it? Who pays for it?
Grouped from salebarns?
What are the In wts?
How long are you gonna keep them?
Are you going to have to supplement feed? Or.....What kind of grass do you have to graze?
Are your fences good?
Do you have the time and knowhow to treat calves?
Who pays for medicine?
What are the deathloss arrangements?
And I second the question--- are final wts with the deads in or out?
Some calves/arrangements would be a good deal at .40/lb
Some calves and arrangements wouldn't be a good deal at .60/lb
And you risk the work and effort and making nothing on some calves and arrangements no matter what you agree to be paid /lb. A train wreck can work you to death and end up costing you money.
This is a classic scheme(con) too-- you may not get paid at all.
know what you are getting into or i second the opinion that renting is a much better option.
Ok, for all of those of you who aren't as dead set against pasturing on the gain as I am, I have a question....
Do you think pasturing on the gain would be a good thing for an inexperienced cattleman to do, first rattle out of the box?
I'm willing to concede that it can work out OK for some folks with experience and who know the right questions to ask and guidelines to set, but what about newbies??
I'm thinking not..
I'm thinking, save yourself a trainwreck and rent it out.
Do you think pasturing on the gain would be a good thing for an inexperienced cattleman to do, first rattle out of the box?
I'm willing to concede that it can work out OK for some folks with experience and who know the right questions to ask and guidelines to set, but what about newbies??
I'm thinking not..
I'm thinking, save yourself a trainwreck and rent it out.
cmjust0":3jaeitk8 said:
I agree whole heartedly! Stockers aren;t for the beginner. If the pasture is rented out you can get a better feel for waht may be needed. The upside is you still get paid and you don;t have to mess with or worry about them.
Texas PaPaw
Well-known member
FT
Here's a link to a book written by a guy that has been quite successful at grazing on the gain. He tells do's & don'ts for being successful.
http://www.stockmangrassfarmer.net/cgi- ... d=360.html
I think you will find it addresses most of the concerns others have mentioned.
IMO it will be the cheapest $35 you can spend before entering a venture such as this.
Here's a link to a book written by a guy that has been quite successful at grazing on the gain. He tells do's & don'ts for being successful.
http://www.stockmangrassfarmer.net/cgi- ... d=360.html
I think you will find it addresses most of the concerns others have mentioned.
IMO it will be the cheapest $35 you can spend before entering a venture such as this.
Stocker Steve
Well-known member
If you are good at marketing and you can get the cash - - then it pays to own the cattle.
If you are good at MIG and you like cattle - - then it pays to charge for the gain.
Otherwise sign a multi year lease and work on something else.
If you are good at MIG and you like cattle - - then it pays to charge for the gain.
Otherwise sign a multi year lease and work on something else.
Family Tradition
Well-known member
Thanks all you have certainly opened my eyes. I was talking to a friend about maybe putting a few stockers on myself and he made the offer @ .32 a lb. kinda run the figures through my head and sounded good if I could put the weight on em but I didn't know enough about it. So that's when I came here to hear from all of ya'll. Thanks!
I have have a small caw/calf herd so I probably know just enough to get in over my head
I have have a small caw/calf herd so I probably know just enough to get in over my head
Jogeephus
Well-known member
If these cattle were born and raised on your friend's farm, I think most folks would agree, this isn't exactly the same thing as your original question implied assuming your friend is a fairly decent cattle person. Cows coming from the same farm are less apt to have the problems that would be associated with a bunch of roughies bought off the sale barn. This would make everything so much easier on you and would definitely make it more attractive to me if I was in your shoes. JMO
Family Tradition
Well-known member
Thanks Jogeephus didn't mean to mislead the question.
Jogeephus
Well-known member
I didn't think you did but I thought it important that this situation might be a bit different than the normal contract gain deal. Some of these contract fellas work with a pretty sharp pencil and you got to be careful. To me, this sounds more like a friendly gentleman's arrangement that might be beneficial to both parties. Win/win - I like these type arrangements.
If the calves are from a closed source(ie ALL from your neighbors cow/calf opp)
AND they have been weaned worked up(incl implant) and preconditioned for 4-6 wks at his place-
or at the very least worked up and fed for 4-6 wks before they are weaned and shipped.
Then you are down to just worrying if you are charging enough to make it worth your time(with the above cattle that should be minimal) and feed inputs.
You should take no share in the deathloss-
cause there shouldn't be any- other than "thats life" stuff he'd have if he kept them on his place.Or he needs to pay you more.....
Just as an aside-- there are some pastures that without supplementation of some kind- you won't get much gain(ie stockpiled winter fescue comes to mind).
And the size of the calves makes a big difference in what supplements/grass are going to be needed.
Good Luck
AND they have been weaned worked up(incl implant) and preconditioned for 4-6 wks at his place-
or at the very least worked up and fed for 4-6 wks before they are weaned and shipped.
Then you are down to just worrying if you are charging enough to make it worth your time(with the above cattle that should be minimal) and feed inputs.
You should take no share in the deathloss-
cause there shouldn't be any- other than "thats life" stuff he'd have if he kept them on his place.Or he needs to pay you more.....
Just as an aside-- there are some pastures that without supplementation of some kind- you won't get much gain(ie stockpiled winter fescue comes to mind).
And the size of the calves makes a big difference in what supplements/grass are going to be needed.
Good Luck
