Chart 2 shows the operating and ownership costs as well as the allocation of resources assumed for this example. Under this agreement, the working farmer must provide all the summer and winter feed with the annual value of the feed market, estimated at USD 312/cow. Farm feed is calculated in market value, not cash. Veterinary and drug costs are shared, with the cow owner providing the vaccines and the farmer working the work. The “Liberation” column shows how to allocate all other expenses. The good thing about an agreement on cow shares is that production costs can be spread in many ways, as long as the calf harvest is distributed in the same proportion as the expenditure. Typically, the cow owner provides the cows and spare hues, while the participating farmer provides the rest of the resources. A beef leasing or sharing agreement allows two trading partners to share production costs and hence the proceeds from cow farming. The question is, what is a fair or equitable way to share cattle income? Here are my proposals for the definition of a fair agreement on the leasing of beef. First, these agreements should be concluded in writing, as the written contract clearly identifies all the details agreed upon.
Be sure to cover all production costs, identify expected death losses and determine associated penalties for excess nertod losses and specify how the enterprise contract will be terminated. It is much easier to work out the details before the contract is signed than to develop a termination contract after an emergency or disagreement. In today`s rapidly changing economic times, annual or semi-annual percentages of changes in resource prices could be redefined. To do this, indicate this frequency of calculation in the initial written agreement. A fair agreement is for the two parties to share the calf harvest in the same proportion as they share the costs of production. If the cow owner pays 25 per cent of the production costs of the cattle shepherd`s operation and the working farmer takes over the remaining 75%, it would be fair for the owner of the cattle cow to receive 25% of the calf harvest and the breeder who works to preserve the remaining 75% of the calf harvest. Second, two parties can enter into a legal agreement that both parties agree with, even if it is not fair. The most difficult part of compiling a fair proportion of cows is the projection of “complete” production costs used to determine fair proportions in calf crops. The full cost should include all means used in the beef business. These include direct costs of the business, opportunity costs for the work and management of the rancher and equity made available by both parties. The depreciation of the cows should be taken into account instead of the replacement costs. I recommend not to include substitution truifs in the cow-sharing agreement.
My experience shows that this does not work and can quickly cause the discontent of one or two business partners. Instead, I propose that the surrogate truifs be developed by a third party and be the responsibility of the cow owner. Those who own the bulls receive income from the mouths of clubs, which should be negotiated and specified in the initial written business contract. Often, the cow owner wants to make the bulls available to control the genetics of the calves. As the price of calves continues to rise, I get more calls leasing cows. Some come from investors who hope to steal the economic benefits of cattle cows. Others come from farmers who work to rent cows as an alternative to financing their herd expansion. In both cases, cattle leasing can be a win-win situation for both trading partners, if done correctly. The flexibility of this approach lies in the fact that these resources can be allocated in all proportions accepted