FEASIBILITY OF A SHEEP COOPERATIVE FOR GRAZING LEAFY SPURGE

This report presents an economic feasibility study of a 5,000 head, cooperatively owned, sheep operation for leafy spurge control. The objectives were 1) determine the return on investment of the cooperative, 2) determine the proposed structure of the cooperative, and 3) ascertain the amount of capital investment required by members in the cooperative. Three sheep flock management alternatives were initially considered for the cooperative. These were 1) winter lambing, 2) spring lambing, and 3) fall lambing. The fall lambing scenario was determined to be infeasible because of logistics associated with gathering and transportation of pregnant ewes and lack of grazing pressure on leafy spurge throughout the grazing season. The total capital investment per ewe for the winter lambing scenario was more than the spring lambing scenario - - $301 and $216, respectively. The expected net income generated by the winter lambing scenario was negative. The minimum break-even lamb selling price or lambs sold per ewe for the winter lambing scenario was $84.10/cwt and 1.33, respectively. The spring lambing scenario returned $124,000 annually. The minimum breakeven lamb selling price or lambs sold per ewe for the spring lambing scenario was $59.51/cwt and 0.94, respectively. The expected return on investment (50% equity) for cooperative members with the spring lambing scenario, assuming a 50-acre leafy spurge infestation in a 100-acre pasture and new fence, was 16 percent (stocking rate of 1 ewe and lambs per acre of leafy spurge). While these returns are not a guarantee of success for the spring lambing alternative, they do provide an indication of the potential that such a cooperative may have.


Issue Date:
2000
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/23270
Total Pages:
51
Series Statement:
Agricultural Economics Report 435




 Record created 2017-04-01, last modified 2017-04-04

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