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15 COSTS OF RAISING SHEEP
Here are 15 costs you need to put a pencil to if you are considering sheep ranching for profit. I am going to give you 10 startup costs, 5 annual costs, and then I am going to tell you the exactly what my sheep farm’s expenses are on a 30 acre scale.
But quickly to answer a major question that popped up in last weeks video: “Why do you focus on a gross of $100k? What about net profit?”
The simple answer is that I have already costed every enterprise on my farm.
Every enterprise on my 30 acre Micro-ranch is on track to earn a net profit minimum of 30% by 2027, with all capital costs paid off.
For me, costing comes first and not last. Long time followers of this channel will know that I have spent the last 17 years in business management for the retail apparel industry. In that industry you do not get the green light to do anything unless you can guarantee satisfactory margins.
So when I became a farmer, I followed the same rules. My goal was to convert 30 acres of grass into a desirable and profitable finished product. So I put pencil to paper and ran the numbers. It is one of the reasons I switched from beef to sheep and you can watch a video that goes in depth about that by tapping here.
Costing first allowed me to get aggressive about my goals. And I have to acknowledge here that it sometimes really painful to be honest about the costs. Like this summer when I spent over $4,000 on hay because we had the 2nd worst drought in 100 years.
I want to encourage creativity in the startup phase. There are a lot of ways to build out these 18 elements. If you don’t have a huge budget straight out of the shoot, there are low cost ways to approach some of the elements on this list. There are a few things that I would not cut corners on at the onset, but for the rest: do your best and make improvements as you go!
Startup Costs:
1. SEEDSTOCK:
Seedstock refers to the sheep (or cattle) you start your flock with. Prices for Dorper seedstock can be anywhere from $350 for quality commercial ewe, to $1,500 for a registered ewe. If you are a beginner, my advice would be to avoid registered animals for your startup. Start with a quality commercial sheep.
2. LAND
Land can either be bought, leased, or bartered for… and I have done all three. The unfortunate reality is that the price of grazing and farm land in the USA has inflated to such an extent that (in most states) you can no longer pay for the purchase of that land with any agricultural enterprise. The bright side is that leasing land is now a more viable solution that ever. The American farmer is aging and the land needs young people to maintain it. For $35 per year I can graze my animals on an acre of land that would cost me $12,000-14,000 to buy. If you are looking at ranching for profit in the 2020’s, you will want to pursue land lease and not land ownership.
3. WATER
Water is an expense to consider, as all livestock needs it. Ponds, wells, hose access, and portable tanks are all options. If there is no water access on your land, ponds and wells drilled on site can cost $15k+. A water tank on the back of a pickup truck is a great solution for sheep farming as sheep consume very little water. A 65 gallon tank costs $230 and one will provide a day’s worth of water to a flock of 60-120 sheep.
4. PERIMETER FENCE
When it comes to small scale sheep farming you need to invest in a good perimeter fence. The fencing at my farm is 6″ woven wire field fence. This costs about $478 per 330 linear ft (materials only).
5. HANDLING SYSTEMS
You will need an area to sort and care for your sheep. If you are just starting and have a very small flock, I would recommend a square pen that will pack your sheep in tight. As your flock grows consider adding a formal handling system to your farm. The tight square pen I started with cost about $500 in materials to construct. The handling system I have now runs about $10k.
6. SHELTER
Your sheep will need a place to escape freezing rain and predators. There are variety of options when it comes to how you can construct your shelter. Prices on these options range from a $500 carport from Facebook marketplace to a $20,000 custom built shed. If you bootstrap a shelter make sure you add gates to the front for predator protection.
The next 4 items are expenses tied to rotational grazing your sheep. I would not recommend starting a sheep farm unless you are able to rotational graze. Moving your sheep a minimum of once a week will cut down on a ton of health problems and save you a lot of money in medicine, mortality, and supplemental feed.
7. FENCE CHARGER
A fence charger for a small system of 10-20 acres will be $250. Larger units for hundred of acres can hit $1000+.
8. ELECTRICAL ACCESS
Solar chargers typically do not have enough power to contain a sheep. For this reason I recommend using fence Chargers that plug in to the wall.
9. ROTATIONAL GRAZING SUPPLIES
Electric polytape, step in posts, etc are fairly inexpensive. I started a really intensive rotational grazing program on 23 acres with about $300 worth of step in posts and polytape.
10. WATERING SYSTEM
If you are paddock grazing, you will need hoses that will reach the various paddocks.
Annual Costs:
11. VET BILLS
On my farm I budget in $7 per head in vet bills. It is not sustainable to haul your animal to the vet for every little emergency, however there are some big ones you will not want to handle on your own. I have about 1 sheep per year that needs vet care. Last year it was a rectal prolapse, the year before it was a c-section. Neither are conditions I am equipped to treat on farm.
12. MEDICINE
Dewormer, vitamin shots, CD/t, and the selective administration of antibiotics are the three medicines I administer within my flock. In my flock, each ewe has a medicine budget of $17.30 and this covers everything both she and her lambs need for one year.
13. SUPPLEMENTAL FEED
If you are feeding hay for the full 90 days of winter, you can expect to feed each sheep $35-45 worth of hay overwinter. This is one area that can really be reduced through management. On average I only feed for 20-30 overwinter.
14. TRANSPORTATION
You will need some way to haul your sheep.
15. MORTALITY
Sheep die, so you will need to factor mortality a a cost.
