A Wild Cow Investment

Even successful farmers and ranchers think a good year is one in which we make a 4% profit-the same percentage your local grocery store strives for in far more comfortable working conditions; gas stations, I believe, try for 3%! This year a Christmas Eve snow storm collapsed the roof over a goat shed, which, with the bitter cold, upset a friend's goat herd so that they flew en masse into slightly premature births.  A full third of next spring's sales crop is dead and the goat mamas got so hysterical that they can't sort out which baby is whose! Some of the kids aren't getting fed, others have two mommies just like Heather, and Barbara will have to add to her load by bottle-feeding the emotional orphans. She's facing a big loss in 2010 cash income and the work still has to be done, a good reason why most people don't want to be farmers or ranchers. Again, as me dear auld faither always said, You can't afford to run cattle unless you have a private income!

Most farmers and ranchers-even successful ones-generally need loans yearly to cover seed, fertilizer, and some operating expenses until they make their crops, be those corn, beef, cotton, or truck gardens. Sensible banks aren't loaning money; they borrow the stuff at .25% and go buy bonds or treasuries that offer a much better return, and phoo! on lending money to maniacs who want to buy houses, enlarge their businesses, or spend frivolously on amonium nitrate and nitrogen-fixing legumes and might well not pay it back. Loans are hard to come by, and no loan means no planting or stock purchases.

That one tidbit of farming lore alone may incline you to consider options for next year's commodities in particular. An ultra-harsh winter and lack of available financing does not bode well for bumper crops or beef and pork bellies at prices which won't make their producers weep in the coming year(s.) Cattle are being sold at half price to halt the hemorrhaging on hay and grain right now. Small dairies are hit quite hard, and a few weeks ago the average head run through the Fort Worth stock yards represented a loss of $150. All in all, this rancher and rancher's daughter says that by next summer and fall meat and dairy prices are going to be considerably higher and continue to rise for at least two or three years, probably for a decade. We lucky few are increasing our herds because we can buy a lot of hay with the average $450 we save on each prime young cow. Rueful smile. With luck the $1300 that just went in the hay loft will hold the girls through the end of the month.  For the nonce cash is really king for small producers ready to expand operations-and remember that Texas was last to feel the effects of depression and has the lowest job losses and relatively fewer problems across the board, other than the border areas with what amounts to incessant invasion by Mexico. Gas here averages 15 cents less than most of you pay, we tend to get feisty about States Rights, and we have a large secessionist movement, the only independent power grid, our own deep water port, so much light sweet Texas crude we can't get it to refineies, and at least an occasional inclination to ask What do you think we need you people for?

What if you found yourself an individual farmer to invest in, one raising both crops and livestock, within easy drivable distance of where you live? You put up two or three thousand dollars, or whatever operating expenses he needs, your investment backed by what he expects to produce based on previous records as shown by his books. However, you don't want money back. What you want is edibles! (That may give your CPA heartburn and let the IRS figure out if cabbages, cucumbers, and carrots are capital gains.)

The Manager of our newest venture at the Bar TS, a truck farm and growing our own grain for feed, was mentored by a man who has a waiting list and a customer base of 125 families he provides at least eight varieties of produce for every week, different each week, thirty weeks out of the year, at $25/week, delivered to eight or ten reasonably central locations. He swaps with other such entrepreneurs, and has already agreed to take all we produce, at fair wholesale value, one reason I'm sure the venture will be a splendid success. I already have the product sold over what we use, and that will cover our costs of feed, fertilizer and good profits for both the Manager/Tenant Farmer and the Home Farm.  I provide the land, machinery, and few remaining start-up costs (a bit of fencing and more fertilizer than usual) and John contributes the expert knowledge and labor.

Obviously, if part of your ROI were superb produce for which you would have to pay $750 if you were part of a CSA (an excellent bargain) you're off to a good start, and if you got three customers of your own lined up and your share were enough for four families you provided the same variety and superlative vegetation, $2000 would return $3000 in kind. Since $25 does not represent what it costs to produce the produce, your farmer is still doing very well, too, because he is returning green, yellow, red, brown, and purple things instead of cash. You could probably do well donating any excess to Meals on Wheels or some other charitable organization if you don't want to hawk vegetables to your friends; the difference between the value of produce fresh from the field and commercial market value is startling. Given that there are waiting lists for CSA memberships, it should be easy to find those who will agree to the arrangement, in which case (all going well), your ROI would be vegetables worth more than the $750 we have valued them at and $2250 from what you sold privately, or you could negotiate for a flat percentage of the profits. At the most conservative estimate your investment should return 50%.

But...what if we expanded what you invest slightly? We're talking of finding a farm that has fields of arugula, tomatoes, potatoes, squash, and so forth and cattle and chickens in all likelihood. As part of your deal agree that Farmer Brown will care for any animals you buy in lieu of interest. A feeder calf will cost you $250 in Texas at present, but will represent almost no extra work or expense for Farmer Brown. He'll turn the calf out to become pastured beef, rather than feed lot beef, so even once you cover the processing costs and original price, you'll end up with 600 or more pounds of superb beef that cost you less than two dollars a pound when wrapped in white butchers' paper. That means no antibiotics, no hormones, and quality that will astound you. Work out how many eggs a week you want, figuring six per hen per week, and fork over enough at $5/head to buy four or five when Farmer Brown gets his, supposing he free-ranges them. A pullet will pay for herself in less than six weeks with eggs at $1.50/dozen (free range eggs sell for twice that.) Allowing fifty cents a week to supplement with a little pure grain, those little beauties are producing at least silver eggs, and the best you ever tasted. Sanderson Farms spends fortunes on sickly caged birds, but it really isn't enough more work to feed a couple of hundred loose chickens than it is half that many; feeding even two dozen for you would mean scattering one more small coffee can full of scratch, which is mixed milo, cracked corn and oats. If you get extra chickens for meat you'll have processing costs, supposing you aren't up to wringing necks, dunking dead birds in boiling water, pulling out their soggy, smelly feathers, and disembowelling them-something I refuse to do myself-but free-range chicken sells for ten dollars a pound! And worth it. They take three times as long to reach eating size as caged birds on hormones and antibiotics you don't want your family ingesting.

I can sense your incredulity. Mrs. Traynham! If the basic costs are so moderate, and it doesn't sound like much work, how come farmers don't make more? Because the rules and millions of local and federal regulations are set to favor Agribiz and this only works for small operations. Start thinking you can turn it into a business and you'll end up with half a million tied up in a single poultry house and far more employees, work, taxes, and expenses than you want to consider. Small-scale agriculture fed families and villages for over a thousand years and still works beautifully. Agribiz has only been around about seventy-five and leads to low-quality products at much higher prices, but feeds cities year around. So far. Transportation available. A small farm cannot produce year-around in the quantities even a modest local grocer requires. Homesweetfarm.com has 18 acres under constant cultivation, but working at full capacity year-around the owner could only provide luxurious vegetables and salad greens for a hamlet of 500, and that less than two-thirds of the year. Albertson's, HEB, Safeway, Fred Meyer, and Krogers cannot function that way; vast urban populations require imports with affiliated transportation, labor, fuel, and currency differential costs-and the additional problems of contaminated products from third-world nations. We Americans have such finicky ideas about not defecatimg in fields, and washing our hands...

Depending upon local regulations and precisely what Farmer Brown turns out, you might also be able to negotiate for real milk, butter, cheese and occasional spring lamb. Farmer B might also have expansion dreams of his own, meaning he would welcome an offer to increase his herds. A good registered dairy goat ($250) or Guernsey cow ($1,000) would be an upgrade for both of you, particularly if he already has a dairy license or a commercial kitchen. The goat will give a gallon of milk or even more (now $16/gallon in Kroger's, not that the dairy farmer ever sees anything like that much) for 300 days, and the cow several gallons/day for the same length of time. It is very unlikely that you need that much for your family; if you aren't the one who shops for groceries find out how many gallons of milk you use a week.  It won't take long to discern the time required to amortize such an investment: at even two gallons, cream, and butter a week Bossy pays for herself in about a year and a half, not even counting that she produces your feeder calf every year. What's in it for the farmer? In return for milking the critter and giving her a bucket of feed, he gets to keep most of the extra milk and cream. He turns a little extra work into having the benefit of a thousand dollars he doesn't have to come up with now or ever. An agreement that he could substitute a young bull from his herd for a heifer your cow produced for your table beef would likely be a major inducement, because that would increase his productive herd at no cost and yield more value than sending an unwanted male to the local auction house.

What will make this deal work splendidly for both of you is that Farmer B gets his operating expenses-be generous and charge no interest because if this works as well as it should you don't ever want him borrowing money from a bank again; you want all his business for the next few years-and returns superior products that are worth more than you paid for to produce them and cost him less than returning cash. If you don't happen to want gourmet quality food, work out a simple percentage of the profits, but my idea is better.

This is a multi-purpose investment; so long as things remain relatively stable you will get superb food worth far more than you paid for it, freeing up cash for other investments. You always have to eat. If we slip into a deep, long depression (or rationing) you will have locked in access to food that others do not have-and you can eat it, sell it, or barter it. If the worst happens and there is a breakdown of the food distribution network for some weeks or months, your food is still being produced and is earmarked for you.

With a little research (or possibly a simple note left on the bulletin board at the nearest feed store or Producer's Co-op! Will swap seed/fertilizer money for a share of the crop!) you might come up with a good investment which insures you against two sorts of catastrophe while making an excellent return if this is just another bump in the road. Besides, you'll enjoy going out to pick up your bounty and playing with the little animals. It will do your children a world of good to find out where food comes from, and that weekly outing (with picnics when the weather is nice) could become a major source of family bonding and enjoyment.

If you're a prepper (one trying to become prepared for TEOT-WAWKI) I'd carry my blinding flash of the obvious one step further once I were on good terms with the Brown family. I'd take out a second insurance policy that Farmer B could like a lot because it increases his ability to prepare for the future by having precious cash to invest now in return for something he may never have to provide, that being the sort of deal that allows insurance companies to flourish while protecting us against the catastrophic. This is just like flood, fire, hurricane, and tornado insurance. Insuring your life against hunger caused by fires, riots, and all those things on my Ten Things I Worry About Most is vital even if you do not believe it is urgent, as I do.

The biggest benefit will come from seeing if you can negotiate sharing his far safer farm if there are riots in the cities or a breakdown of economic, social, and financial conditions and/or food distribution. Even if he thinks you're insane chances are you can arrange to park a used motor home or travel trailer on his place, with his only responsibility being protecting it from vandals, something that will require nothing more than the precautions he already takes supposing you stick it out of sight somewhere.

The agreement you want to nail down is that IF things fall apart for a while you will live in your house on wheels, provide your own basic supplies (flour, sugar, rice, olive oil, spices, and the ordinary things of life like toothpaste and toilet paper), and pitch in with basic chores and sentry duty to ensure general safety. If the right person asked me I'd smile, agree, and charge him nothing, because he would add to my basic security. If FB wants a couple of thousand-give it to him, because what you just bought is peace of mind and a place to store your rice and space blankets.

What you need most in the minds of Preppers is a destination and a place to store your emergency preparations safely, and nothing makes more sense than the country and where you have a stake in the food being grown. With that imperative luxury prepared for all you have to do is pick up a nice old motor home or RV at $50-100/running foot off Craig's List, the biggest you can afford in case you have to live in the thing for several months, and stock it (Less space at a vulnerable storage rental outfit will run you a minimum of $100/month fpr 100 square feet. Put that way, you could store Christmas decorations and out of season clothing and be ahead in less than a year and a half by buying a trailer you have someplace to park, although that would be very poor use of the space.)

The real safety factor comes from having the bulk of your emergency food and barter goods tucked away safely where you intend to hunker down, IF it comes to that; if you start thinking it is all going to blow, grab the kids, the dog, and whatever else fits in your biggest vehicle and GOOD, as we say: Get Out Of Dodge. IF what could happen does, nothing will enhance your family's safety more than being able to escape the confines of a city and get off freeways and interstates quickly without extensive packing and shopping. If you are polite (and of course you would be) you could surely spend an occasional enjoyable weekend in the country stocking your hideaway and burying your collection of Mercury dimes and such other things as seemed sensible to you. This will be a whale of a lot cheaper and more convenient than any other alternative I can come up with and will not involve learning to farm, living in the country until there is no safer choice, or having to milk goats and cows twice a day around the rest of your life now.

Thanks, Doug! If you hadn't triggered the thought processes, I might never have come up with anything this easy, profitable, and sensible!

Warm regards,Linda Brady Traynham

January 4, 2010

P.S.: Send in those applications, Shooters!

WANTED: A retired vet or doctor who will enjoy being part of an extended family. Remuneration includes your very own guest quarters (AKA a motor home or recreational trailer with bath, kitchen, heat, AC, sleeping facilities, blessed privacy) and utilities (limited only by how long the electric grid is functioning and diesel fuel for the generators holds out), and full board. This phrase is unknown to most people but means that all meals, and in your case kitchen access, are provided. This includes fresh produce in season, pastured beef, free range chicken and eggs, milk, cream, butter, our elegant farm cheese, home-smoked sausage and hams, pecans, citrus fruit, and ample supplies of flour, sugar, salt, rice, sour dough, unadulterated deep well water, and so forth. Peaches, if we can keep Buck out of them. BYOB, or be prepared to run the still when we build one. (It is still legal to produce five gallons a year/person, I believe, tax free.) Amenities include riding horses, stocked lakes with bass, catfish, and perch, deer and wild hog hunting, wi-fi (so long as the cell phone towers are functioning), and your choice of farm activities if you find any of those agreeable pastimes. Bridge, Cribbage, Pinochle, Backgammon, Dominoes, and Hearts players available, as well as erudite conversation on almost any subject. Smokers welcome. For nonsmokers, you have your quarters and we run 4 Ionic Breezes in the public areas. War is hell, live with it. Funds will be provided to stock medications and the most basic equipment; sorry, can't afford an MRI or X-ray machine. Your responsibilities at present would include basic health care for 21 head of Black Dexter Cattle (lovely, placid little cows who give birth easily and are very hardy), a very sweet and gentle Guernsey, a Jersey, three hogs, two horses, and fifteen goats. In 2009 the only vet bill was for a young bull who died of oak leaf poisoning; the hand responsible has been fired. During 2010 we expect to see an increase of 20 young goats and ten calves, and as many hogs as anyone cares to catch in the big A&M trap. Three very nice dogs and a miniature Jerusalem Cross Donkey, and if anyone has an accident during TEOT-WAWKI suturing an occasional wound or setting a broken bone, if that came up. I don't know that this is like cats (Put both ends of the broken bone in the same room and it will heal.), just do your best. We'll see to it that all blood types are known and find a way to come up with Ringer's Lactate. Bring your own tongue depressors and we'll respond to, Just say 'Moooo.' This is the deal of the century for someone who no longer has a full-time practice but is concerned about being self-sufficient and would like very congenial companions and to work with nice animals occasionally. We only have a few rules around here: don't throw cigarette butts down in my pastures, don't shoot anything that belongs on the place without my permission, don't waste food or electricity, close gates you found closed, and if you can't say something nice, don't say anything. Your pets are welcome so long as they don't kill chickens or fight with ours. Lessons in everything from Egyptian hieroglyphics to marksmanship available...and what would YOU like to teach? Someone will be interested!

Also interested in a retired gunny or smadge, special consideration given to a submarine medical corpsman, COB, or Viet Nam era vets in reasonably good health. Chuckle...Colonels are a dime a dozen, but an old centurion will always get you through safely. An expert in making cheeses...a butcher...carpenter/handy man...a chiropractor...anyone honest, reliable, responsible, laid back...tell me what you have to offer to my joyous oasis that makes it worth my while to feed you if the worst happens.