imageI’ve been working on long-range farm income planning, and it’s an interesting exercise, to determine if we could make a living at farming, and if so, how and when. It’s definitely not easy and the potential profit horizon is a long ways out! Our potential plan is complex, as we are considering farming multiple species of plants and animals and growing the operation over time, so it makes for a huge spreadsheet with lots of variables, risks and unknowns.

But here is a fun and simple example for someone thinking of getting into sheep or goats and hoping to make a little extra cash.

The Five Ewe, Eight Year Plan

Say you have five acres, a small barn and decent existing fencing. So, you buy five ewe lambs and a llama to guard them. Let’s choose hair sheep so you don’t have to pay to shear them. You’ll breed them and sell all the lambs each year, expect each ewe is productive ‘til about age eight, and dies of natural causes at age nine. We’ll figure 180% lamb crop- that most of the time your ewes will have twins or triplets, but that you’ll likely lose some.

We’ll assume your Northwest pasture supports grazing about 8 months out of the year, and that you buy hay at $240/ton- a typical price for buying in small quantities. Assume grain is bought in 50 lb sacks at about $11 per bag. Figure the llama eats the same as two sheep; figure 3% of their 120 lb body weight in hay per day, plus a pound of grain per day for each animal during flushing, late pregnancy and early nursing.

You’ll need maybe 20 bales of straw per year for bedding and mud control. Supplies needed will be things like ear tags, lambing equipment, feeders, troughs, etc. We’ll assume you get lucky and never have a vet farm call, and never face catastrophic illness in any of the ewes. But let’s also assume that you can do basic procedures like giving injections, treating wounds, trimming hooves, assisting births, and tube- and bottle-feeding lambs. We’ll assume that you choose to utilize wormers and antibiotics on occasion, and that you supplement with minerals, and of course from time to time, you’ll have to purchase milk replacer for bummer lambs. And lastly, you have to rent a ram each year to breed the ewes-maybe your neighbor will give you a deal and lend you one for twenty bucks!

Big Money?

Below is a spreadsheet of that investment over the eight year life of your ewes. It’s easy to think, wow, $1800 per year in lamb sales; woot, those ladies could buy me a new car in eight years! But, unfortunately, the expenses make for razor-thin profit margins: only about $100 per year per ewe. And then if you figure you spend a half hour a day caring for the sheep, <sigh>, you are only getting paid $2.75 an hour! That’s not exactly a get-rich-quick scheme, is it! 😀

A simple exercise like this shows a few things. For one, we can see why most people need to “go big” to make agriculture pay. If you ran 1,000 head of ewes instead of five, now maybe you’re talking a reasonable annual income. But of course, it’s more complicated than that, because you’d need a lot more land, equipment and help to go that route.

This also shows why anyone in agriculture may be tempted to cut corners anywhere they can, and the most significant place being in animal care. Skimping on feed quality, veterinary costs, and labor to care for the animals is common. It’s something to keep in mind every time one jumps at the $.99 per pound chicken in the grocery store, because one has to wonder, what kind of management practices enabled them to sell it so cheap? Whereas, if you are buying local, you can verify for yourself how the animals are cared for. And, you can choose to perhaps pay a little higher knowing that your money is committed to ensuring good husbandry and an honest living for a farmer.

Making It Work

I think overall, the exercise shows that to make small farming work, you have to diversify a lot more. Big farms have optimized efficiency by focusing on a single crop, and that has its advantages in consolidating expertise and equipment investment. But, there are also drawbacks: single-cropping wears out the soil fast, and is a magnet for pests that perceive a thousand acres of corn as a species-specific field-of-dreams. These two factors enslave the farmer to chemicals and high costs. And, there is more risk- in a year where weather or natural conditions are not favorable to the single crop, all is lost.

Contrarily, Joel Salatin-style “poly-culture” farming seems to make more sense for the little guy. Rotating crops and having multiple species share growing space is better for the soil and better for pest management. It maximizes how much you can produce in a small space. And it spreads the risk: if a heat wave wipes out all your lettuce one year, or all your sheep eat a toxic weed and abort their lambs, all is not lost- you still generate income on the crops that did OK. There seems to be a growing trend of farmers who are making it work this way, as well as learning to reach customers in new ways, such as farmers’ markets, CSAs, and the web.

What does your farm plan look like? Are your ewes saving up to send you on a Caribbean cruise? 😀

Year 1 2 3 4 5 6 7 8 Totals
Buy 5 ewes $ (1,000) $ – $ – $ – $ – $ – $ – $ – $ (1,000)
1 llama $ (100) $ – $ – $ – $ – $ – $ – $ – $ (100)
Hay cost $ (363) $ (363) $ (363) $ (363) $ (363) $ (363) $ (363) $ (363) $ (2,903)
Grain cost $ (117) $ (117) $ (117) $ (117) $ (117) $ (117) $ (117) $ (117) $ (936)
Bedding $ (160) $ (160) $ (160) $ (160) $ (160) $ (160) $ (160) $ (160) $ (1,280)
Vet care $ (250) $ (250) $ (250) $ (250) $ (250) $ (250) $ (250) $ (250) $ (2,000)
Supplies $ (250) $ (250) $ (250) $ (250) $ (250) $ (250) $ (250) $ (250) $ (2,000)
Ram rental $ (20) $ (20) $ (20) $ (20) $ (20) $ (20) $ (20) $ (20) $ (160)
180% crop $ 1,800 $ 1,800 $ 1,800 $ 1,800 $ 1,800 $ 1,800 $ 1,800 $ 1,800 $ 14,400
Net Profit $ (460) $ 640 $ 640 $ 640 $ 640 $ 640 $ 640 $ 640 $ 4,021
Net per ewe $ 804
Labor Hrs 183 183 183 183 183 183 183 183 1,460
Hourly Pay $ 2.75
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