Contract rearing in action
Collaborative Farming Specialist at Teagasc, Ruth Fennell takes a close look at how a contact rearing arrangement has been working out for two farmers in Co. Waterford over the past six years.
James (Jimmy) Kearney and his son Michael farm 45ha (plus commonage) in Ballysaggart, Co. Waterford. They have been rearing replacement heifers for dairy farmer, Adrian Casey for the last six years.
Discussing the system, Jimmy explained: “Prior to this, we were running a Friesian calf-to-beef system on the farm, purchasing bull calves from Adrian.”
Adrian added: “Back then, I lost a parcel of leased ground that I was using to rear my replacement heifers. That spurred me to think about contracting out the rearing of my replacements. Naturally, Jimmy and Michael came to mind.”
Jimmy Kearney and his son Michael have been contract rearing replacement heifers for dairy farmer, Adrian Casey (right) for the last six years. Picture: Mark Moore
Developing an arrangement
The Kearneys were an obvious choice, as Adrian knew their set-up and was confident that the stock would be well managed
“We used the Teagasc contract rearing template agreement during the initial discussions,” said Jimmy.
The agreement was drawn up for an initial three years and covered all aspects of the arrangement including transport, dosing, vaccination, breeding, weight targets, conception rate targets and also what costs were to be borne by each party.
They also agreed a maximum mortality rate and infertility rate and, if levels were above this, a penalty system would apply. The contract covered all aspects of the agreement in case any issues arose. Thankfully, in this case, there haven’t been any.
“There is give and take and there must be trust on both sides,” Jimmy said.
Once they had agreed the terms of the contract, the price was the last topic to be discussed. The fee is discussed at the beginning of the year and the Kearneys are paid the agreed fee by monthly standing order.
Each spring, the Kearneys collect approximately 80 calves in batches from Adrian. Calves are transferred from 14 days old.
“I only need approximately 50 replacements per year for the 250-cow dairy herd, and we have agreed that there should be no other bovine stock on the Kearneys’ farm. So I have to provide sufficient numbers to fully stock the farm,” Adrian said.
Following the breeding season, Adrian will pick 50 to 55 of the early-calving heifers and the remainder are then the Kearneys to sell when they choose. Adrian’s in-calf heifers return home on a phased basis from October to December at 21-23 months of age.
Adrian covers the cost of transporting the heifers home, vaccines and breeding (a combination of synchronisation, AI and stock bulls to mop up); Jimmy and Michael cover all other costs.
Target weights
A chart of target weights is pinned to the wall above the crush where stock are weighed regularly. “The figures are available for Adrian when he visits,” Michael added.
The agreed weight targets are based on Teagasc guidelines and it is up to James and Michael to ensure that the heifers reach these targets. Adrian said he feels that it is important that the feed costs are borne by the rearer.
“It encourages them to ensure stock meet their weight for age targets as economically as possible rather than the livestock owner paying higher feed costs if stock are behind target,” Adrian said.
The agreement is working well for both parties. The Kearneys have regular, repeat customers for the in-calf heifers that they sell themselves and they appreciate that they are no longer at the mercy of a volatile beef market.
Given that Adrian doesn’t have the replacements for the first winter, this has ensured that he is able to meet his slurry storage requirements for the retained stock. He said this arrangement has also taken huge pressure off the system at calving time, saving both time and labour. Long may it last!
Contact rearing agreement checklist and essentials
- Arrival and removal date of animals on the contract rearer’s farm. Who pays for the transport? Will heifers be mixed with stock from other farms?
- How often will the owner visit the rearer’s farm to check on stock?
- How will heifers be managed during the winter?
- How will they be managed over the grazing season?
- Will stock be weighed during the contract and if so by whom and when?
- Is reaching weight targets part of the agreement and what are the implications if targets are not met?
- What happens in the event of a regulatory disease outbreak?
- What is the agreed cost? Outline what this includes and excludes in detail. What method and interval of payments will be in place?
- The breeding programme – is it AI or a stock bull? Who does the heat detection and what costs are included/excluded from the agreement?
- How will mortality and empty heifers be addressed?
More information
For more information on contract rearing, view the Teagasc contract rearing agreement template here.
Visit the Collaborative Farming section of the Teagasc website
Also read: Making contract rearing a ‘win-win’ for all involved