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Scaling Up

Avoid pitfalls & maximize profit as you expand your herd or flock.

By TREENA HEIN

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You have a small flock or herd, and things are going well. You’re beginning to think that you should fill the expanding market by scaling up your livestock or poultry business. Economic conditions have forced many small farms to get larger, says Canadian Shorthorn Association National Director Martin Mason. “It’s not greed; it’s been necessary for survival,” he notes.
However, Michael and Glorianne Bjerland, who raise Dexter cattle in Pense, Saskatchewan, say that expansion should first and foremost be a matter of sustainability. “The key is to know when you’ve reached your maximum production level,” they observe. “We are limited due to a small land base and manpower.” In addition, they personally do not want to compromise the health of their animals or land in an effort to produce more.? The Bjerlands also note that getting “bigger” might mean thinking outside of the box: for example, adding another species to the farm such as pasture-grazing pigs to control noxious weeds that cattle won’t eat.
If you’re seriously planning to scale up your livestock operation, there are many aspects that need some thought. Do you expand by breeding over time? Or is it best to buy more breeding stock, a quicker solution that infuses new genetics, but also costs more? How do you best handle buying and storing bulk feed and other materials? In terms of marketing, selling a few sides of beef or a few eggs is different than selling much more. Chances are you can’t sell to single customers and will need a few larger customers to make most of your sales, but if one of them falls through, you can be left with a lot of livestock to look after. And the more you produce, the closer you get to Big Ag Issues.
Some aspects of scaling up—such as purchasing feed and minerals in bulk—are common to all types of livestock rearing. It’s cheaper to buy in bulk, but building or buying the facilities to store it safely away from pests and moisture involves expense. The feed also must be used before it loses nutritional value.
For more specifics on how to meet the challenges of boosting your cattle, llama, goat, chicken or sheep production, read on.

Cattle
Martin Mason, who farms a herd of 30 shorthorn with his wife Liz and their sons in Drumbo, Ontario, recommends increasing your cattle herd through both breeding and buying stock.?“Irregardless of the choice, be sure you have an ideal in mind [for your animals] and strive for your ideal,”?he says. This may change over time with market demand or one’s own preferences.?Mason notes that if your herd doesn’t meet your ideals, it may be preferable to purchase the type you desire rather than try to breed it yourself. If purchasing, he advises to try and look at the dam and grand-dam.
“A breeding program is a long-range plan,” he cautions. “Your ideal is not normally acquired in one generation. Remember, it costs about the same to keep a good cow as it does to keep a poor cow, so seek to have the best cow herd you can possibly have.” That’s why Mason recommends the use of artificial insemination (AI) for on-farm breeding.?“Superior genetics are available through AI and you don’t have the expense of housing and keeping a bull for 365 days of the year,” he says.
However, the Bjerlands favour doing their own breeding. “It’s cheaper and it does take time, but in the end you will have animals that?are to?your?liking,” they say.?“We have also brought in new genetics using AI, but were more satisfied with using?stock we already knew.”
Although not much cattle feed is purchased in bulk—perhaps only calf feed or post-weaning feed—Mason recommends storage in a hopper-bottomed feed tank. “Preferably, stay away from purchased compound balanced feedstuffs?as much as possible, simply for the sake of your bottom line,” he advises.?“Have your home-grown feeds analyzed and balance with supplements if necessary.” The Bjerlands used to buy grain in?mini bulk bags, but found it awkward and time-consuming. “We did not have a tractor to lift the bag from the truck, so all grain was taken out by pail and then ground by an old Mac clouds grain grinder,” they note. “Today we have a?1,200 bushel grain bin and use an auger … from the bin into the grinder to make chop for?all?our animals.”
In terms of selling increased product, Mason says direct marketing is a good way to increase profits, but admits not all farmers can do it.?“Marketing becomes another task that is time-consuming and I don’t think many small farmers who also work off-farm can do it well—simply because of the resources it demands,” he observes. Marketing issues to consider include lining up orders with the time of butchering and storage of butchered product. He notes that purchasing a side is a significant one-time expense for many customers and they need adequate storage space. “One also has to make sure you are only selling quality,” Mason says.?“The consumers’ experience has to be more than positive – they have to be delighted.” He recommends that, in addition to selling halves or quarters, farmers should think about making up boxes of assorted cuts, such as one for $100. “Consumers like to see the products they are purchasing,” he adds. “Plastic vacuum packaging is a bonus to consider if it’s available to you.”
Bjerlands have kept their pricing steady from season to season even though input costs have risen, and periodically check prices at the organic food store and use these prices as a “reality check.”

Llamas and alpacas
With llamas and alpacas now in demand for their fibre and meat, and as herd guardians, breeding stock and therapy animals, the opportunities to expand your operation are bright, says Walter Coombs, president of the Canadian Llama & Alpaca Association. While dogs and horses have been used in therapy for many years, rabbits, llamas and others are now making inroads. “Llamas, by their nature, are innately compassionate, calm and nurturing,” says Coombs. Like other animals, their presence can help with people with depressive issues, anxiety and more.
At Pacific Animal Therapy Society on Southern Vancouver Island, Inca the llama does therapy visits with both the?young?and?elderly, in a hospice and many other?facilities.?“He is no problem in?elevators?or?on stairs,” says spokesperson Sadie Guy. “We?have to watch him closely though if?near?roses,?etc.,?as?he?will?eat them!”
Coombs farms 30 llamas northwest of Edmonton and sells pretty much all animals for guardian purposes. “Analyze your market,” he advises. “To sell more animals, spread a larger geographical net.” With a gestation of 11 months, increasing your herd of llamas through on-farm breeding will take a while. “The good news is that price of new breeding stock has decreased radically since 2003,” says Coombs. “This is partly due to the border closure due to the BSE crisis, but also the demand for breeding stock has dropped off.” Today, a registered show-quality sire costs about $500, where the same animal would have been worth a remarkable $100,000 in the early 2000s.

Goats
It’s a snap to increase your goat herd quickly with the species’ tendency to birth twins and triplets, and that’s what Canadian?Goat?Society President Sherrie Semple advises. At the same time, she strongly cautions to start out small and grow with your market. She also sees purchasing large lots of animals as risky. “The problem with this is health issues,” she notes. “I would increase a herd myself and bring in bucks for new genetics.”
In addition to needing adequate pastureland you will of course need things like more barn space and added fencing as you grow your herd. With dairy goats, you will need more milking equipment and storage.
In terms of marketing an increased volume of product, Semple advises “Make sure you have contracts in place ensuring a minimum purchase requirement. You could hire salespeople or approach companies yourself to sell your product, but doing it yourself also takes away from the running of the business.”

Sheep
Bob and Laurie I’Anson Laurie’s Little Lambs near St. Catherine’s have increased their flock from 10 to 29 Old English Southdown Babydoll sheep in the recent past. Bob plans to lease them to vineyards in the vicinity to keep weeds and grass down. “The practice is fairly new in Canada, but sheep are widely used for this purpose in Australia, New Zealand and France,” he notes. “Vineyards save a lot of money in terms of labour in grass cutting and chemical usage. Babydoll sheep are well-suited for this with their small stature, and there are hundreds of wineries in this area.” One Ontario winery that began the practice several years ago uses weaned lambs until grape ripening, at which time the lambs are slaughtered, but I’Anson plans to use adult sheep and remove them during ripening (when the grapes make attractive snacks) and then return them after harvest. “It takes four or five sheep per acre of vineyard, so I would like to expand my flock to around 50.”
With a rare breed such as Babydolls, I’Anson says it’s typically only possible to import a small amount of stock at a time. “I imported two groups from the U.S., and I am going to increase my flock through my own breeding from here,” he says. “It will expand quite quickly with twins and I have been advised about a supplemental ration that increases chances of twin births.”
At Black Walnut Lane Farm in Millgrove, Ontario, having twin births is an important goal in order to have saleable lamb year-round. Owners Ron and Adele Service raise Dexter cattle and many breeds of sheep, and Adele says expansion was based on observation and record-keeping with the different breeds. “We have been gradually increasing our flock over the last ten years with our own breeding program: up to 160 ewes,” she says. “After a number of years of observing the stamina and productivity of the full bloods and cross-breds, in 2008 our main focus became Jacob and Texel (full and cross-bred), with?the introduction of the Booroola gene (otherwise known as the “twinning gene”).
When they looked into supplying local farmer’s markets with lamb last year, they discovered they didn’t have enough and had to buy from another farmer before they bought 110 commercial Katahdins to fill the demand.?Adele notes: “The work load doubled … We needed more shelter, more equipment, more feed … therefore more instant expenses, more stress. However, we are now producing and selling all our own lambs at three farmer’s markets, plus freezer orders and to two restaurants.”
At a certain point, it became very obvious they needed a bulk feed bin, says Adele. “It was a 5 tonne bin raised high enough so that we could fill a wheelbarrow under it.?Quickly thereafter we purchased two?3-tonne gravity grain wagons.” In the meantime, Ron was doing research on corn silage: methods of storage and feeding. “He purchased a 2 tonne side opening mulcher, for line feeding,” notes Adele.?“We also had to rent more land to grow more hay. All these decisions take time and resources, plus research, asking questions, networking, problem solving, taking courses, etc. I am not sure that there is a straightforward template of how to do this, as everyone’s situation is different.?That is why I do appreciate the wealth of information that is available via the Internet and through the Ontario Ministry of Agriculture, Food and Rural Affairs.”
In terms of pricing, Adele says “At some point a few years ago I decided I would not apologize for the price of our lamb. I ‘knew’ my flock and the labour and infrastructure and most of the cost of production it took to produce our lambs.?Quality food does cost more money [and] the educated consumer understands this.” She says she watches prices in the greater Toronto area, in specialty butcher shops, grocery stores and also monitors at the farmer’s markets to see what cuts are selling well and being asked for. In addition to lamb, the Services sell beef (their own Dexter and Angus), bison (bought from a rancher in southern Ontario) and wild boar (raised by their farm business associates Mark and Tania Veenstra). They’ve currently run out of beef inventory. ?

Chicken
Expanding a chicken flock is accomplished through chick purchase but, like others, Al Keshwani, owner of Rochester Hatcheries in Westlock, Alberta, advises establishing your market first and increasing your operation in stages. “Don’t be scared to get bigger, but do it in steps,” he says. “Farm gate or farmer’s market, you have to market and build a clientele. People will see the quality a few times and then establish themselves as regulars.”
You’ll also have to stay within the quota for small producers, which varies widely by province. For example: in Alberta it’s 2,000 birds while in Ontario it’s 99. However, Keshwani advises talking to your provincial marketing board about exemptions for small producers. “There are options,” he says. “You can lease an organic [commercial] quota for a small amount; then after a few years you can buy the quota.”
Looking after a larger number of birds will probably mean automating your watering system, and could mean automating feed, ventilation and heating. “Humidity management is very important with larger numbers of birds,” Keshwani says. “You’ll need a fan and it should probably be automated to come on when needed.” To make sure your temperature is what it should be, it’s not about how many heat lamps you have, he notes. “At some point lamps aren’t a good idea anymore. You need a more efficient heating system. Bulk feed offers savings over bagged feed and is also a better choice because it can be mixed to specifications.”
Keshwani says pricing is straightforward. “It’s what the market will bear,” he says, “but that’s different depending on how chickens are grown with regard to welfare and other conditions, organic or not.” You must also determine where you will get the birds processed (in the case of broilers) and work that cost, as well as transportation and time, into the price. He advises getting as many signed contracts as you can. “A lot of small customers is a safer bet than a few big ones,” Keshwani notes, “because if one drops away, that’s only a small percentage of your sales.”
Whatever livestock you raise, Adele Service stresses that to successfully expand your operation you need to have “fire in the belly.” “That is what we have when we talk around the dinner table,” she says. She also concludes that to have the energy and skill sets for creating a farm business (which include vision, financing, breeding and day-to-day operations, planting, harvesting, marketing and selling),
“It takes a team.”