Case Study 4: Lambs
About the farm
Jim has 80 ewes, two rams and 120 lambs on his 26-acre farm. He leases an additional 24 acres nearby for additional summer pasture. Jim feels that sheep farming is very rewarding occupation. Farming alone would be the perfect lifestyle, if it were possible to make a living doing it.
Jim didn't have farming in his background but because his father was a veterinarian, he spent some of his childhood traveling with his father to farms. He noticed from an early age that there was a relaxed and jovial atmosphere on farms that he didn't feel anywhere else. He fought against his parents' wishes that he not become a farmer. He conceded by getting an education that provides him with a well-paid job so he can farm part-time. He now sees the wisdom in his parents' insistence because making a living at farming sheep is not possible in the current food climate.
Farm Marketing
Jim is in an interesting conundrum with collapsing farm infrastructure. There is only one meat processing facility in the region. The operator of this facility is reluctantly still in operation, but is long passed retirement. Jim could easily sell his lamb directly to his own customers because of the demand, but he recognizes that if he allots a portion of his lamb for wholesale through the processing facility, it helps bring revenue to this business. He figures that maintaining good relations with the abbatoir pays other dividends because at peak times, some farmers have to wait months to get their lambs processed. He feels he gets some preferential treatment at times like this because of his cooperative commitment.
Jim sells about 5% of his production to friends and neighbours, because "they'd give me grief if I didn't." His slogan is: "if customers aren't flexible, they aren't customers." He feels there is a lot of room in the market, and none of his customers have concerns about price. He feels that direct marketing takes time and energy to plan the logistics of how to get lamb and customers connected, so he is not bothered by his commitment to the slaughterhouse. He doesn't do any promotion because he doesn't need to, and because he'd "rather not have conversations about killing lambs with people who don't understand."
Seasonal Workload
Jim characterizes his on-farm commitment as year-round, part-time, with peak times from January to March with lambing, and then June with haying. During these peak times he's spending an average of four hours per day with the sheep. Other times, he can go a week or more without doing more than scanning the flock every few days for problems.
Limitations
Besides the lack of processing facilities and the poor return on lambs, Jim laments the lack of processing facilities for wool. There really is no market for all the wool from his lambs, but if there were a facility to wash and card the wool, perhaps it could be developed into a cottage industry for some local families.
Farm Finances
Jim's gross receipts from the sale of his 120 lambs are $15,400, and his net is just over $5000. The sad reality of this well-run operation is that if Jim were just to sell the hay from his land, rather than feeding it to the sheep, he would gross about $24,000. Instead, he buys in an additional $5000 of grain as feed for his sheep. After the grain, his next biggest expense is fertilizer, and machinery maintenance.
Jim feels frustrated that his off-farm work as a veterinary must support his work as a farmer. Unfortunately, he doesn't feel that economies of scale can help him very much, so he is resigned to keeping his off-farm job. He likens farmers to an indicator species for humanity. "We are right where the rubber hits the road, we are the real interchange." The fact that farm finances are so dismal has consequences for our food system and for our future ability to feed ourselves.
Assets
Jim's breeding stock, his well-maintained pastures, his out-buildings and machinery are key holdings for his operation. Jim designed a beautiful three-season sheep shelter, which is basically a roof with no walls where the sheep spend the wet part of the fall, winter and early spring. The large white tarp is bright and cheery, the straw bedding is dry, and there are no issues with adequate ventilation.
Another important asset is Jim's training as a veterinarian. His specialized knowledge of large animals enables him to care for the animals himself, which cuts down costs and helps him benefit from their superior health.
Why this business works
Despite Jim's meticulous record keeping, his devotion to his animals, his community connections and his excellent land stewardship, technically his business isn't working because it costs him money to keep it running. If we were to measure his personal satisfaction, his animals' fine form, the increasing organic matter in his pastures, or the value that the community feels when seeing his sheep in the pasture, he would get top marks. Financial sustainability is not the reality for many farmers in Canada due to the impossible economics thrust upon them through global trade. It is crucially important that we find a way for farmers like Jim to realize returns worthy of their investment because ultimately our food system depends on them.
written by Robin Tunnicliffe, edited by Barbara Joughin
Last Modified: September 23, 2014