Tips for Squeezing Every Drop of Profit From Your Small Ruminant Herd

There used to be a time when keeping a respectable flock of sheep or herd of goats offered an acceptable return by simply sending  yearlings and culls to the local auction and possibly capitalizing off the fiber.  But according to a report from the Economic Research Service of the USDA, the US sheep and wool industry has been in steep decline since the end of World War II due to the introduction of less expensive synthetic fibers and a growing import of meat lambs. (Jones, January 2004) More recently, the National Agricultural Statistics Service cited a decline in both the national sheep and goat numbers. (NASS, February 2013)

Yet small ruminants continue to grow as the stock of choice for small acreages and direct marketers willing to get creative with multiple aspects of the value chain.

Typically, sheep and goats have been pigeon-holed into their respective revenue silos—milk, meat, fiber—but with rising input costs (feed, fuel, land, infrastructure, etc.), producers can no longer afford to be satisfied with what the commodity markets offer.

The need for better return combined with an increase of women and older farmers choosing smaller, more manageable livestock has resulted in new and innovative ways to increase profitability from small ruminants by creating multiple revenue streams from a single flock/herd.

Getting Started—Think Outside the Pasture

In order to begin maximizing the profits from your small ruminant herd, there are three primary question to ask yourself.

1. What am I going to produce?

2. How am I going to sell it?

3. To whom am I going to sell it?

The key in answering these questions is to exhaust all the possibilities for what constitutes your herd or flock.  For example, your primary reason for raising sheep may be for fiber, but still leaves you with the possibility of meat, breeding stock, show stock and targeted grazing. To exclude facets that may not provide a primary return lessens the flock’s overall profitability and ultimately, your farm’s sustainability.

In an effort to achieve profitability, many farmers today are pushing past the traditional mental fencing when it comes to increasing revenues.  For many involved in small ruminant production, that means extracting diversified, multiple income streams from the entire flock/herd and not just a singular product.

States of Revenue

The two main states that livestock produce income are when they are alive and when they are harvested (dead).  During each stage of the animal’s life, there are multiple opportunities for income.  For example, a dairy’s primary target for revenue is the milk. But as many fluid milk dairies are falling victim to increasing input costs, producers are turning to value-added products such as cheese, fudge, soaps and lotions. For those who pride themselves on purebred and registered animals, breeding stock and show animal sales will help boost the bottom line.

Fiber animals, too, renew their primary resource year after year and can yield similar revenue streams, including a value-added product chain (raw fiber, roving, yarn, textiles) and livestock sales.  My hat’s off to all those wonderful fiber producers!  Cashmere and mohair  goats are every bit meaty as the standard South African & New Zealand breeds of meat-type goats. I’ve seen them on the hoof, on the rail, in the package and on the spit. But I’ve had this privilege because not all livestock producers want to pursue terminal avenues.  Over the years, I’ve prided myself in clothing myself in the fibers of the meat I’ve marketed and eaten–socks, shawls, hats and sweaters.

Similarly, many goat (and sheep) dairies send off what could be a significant portion of income for their overall operation if they would consider looking beyond the confines of their primary product and following the traditional method of male offspring and cull disposal.

Gaining in popularity, targeted grazing and browsing is another way to profit from small ruminants. Businesses, specific to brush and invasive species control are springing up throughout the country.  Pasture-based stockmen are adding goats in particular to their existing cattle herds to take advantage of high-protein browse instead of devoting resources (chemical or mechanical) to address what most conventional producers view as a problem.  Calves run with goats provide the added bonus of teaching young stock who traditionally don’t browse to eat palatable and nutritious forbs and woody plants thus extending pastureland and increasing the rate of weight gain.

Acceptance of the end of the line.

Regardless of your stock’s primary purpose, ultimately sheep and goats end up at the end of the line, most often as meat. Over the years, I’ve witnessed countless small ruminant dairies and fiber farms shipping their young males and non-breeding culls through local stock dealers where only pennies per pound are returned.  With the shrinking numbers of small ruminants and the demand for meat driven by a growing immigrant population as well as robust local foods movement, prices have been pushed as high as $200 for kid goats in the 20-35 pound live weight range.

Similarly, cull animals when processed into value-added products such as ground meat, sausage and even pet food can net double, even triple, what they would bring on the live open market. Increasingly, this option is becoming more amenable to non-meat producing farmers as the concerns for humane treatment and terminal sales are addressed.

Consider this—livestock can spend as long as ten days to two weeks making the rounds through various regional sale barns prior to reaching the terminal destination. In my personal experience, pasture-based producers have very strong beliefs and opinions about how livestock should be raised, fed and handled. Increasingly, farmers and ranchers want to know that their beloved stock are treated humanely in the final hours of their lives.

With the growing local foods movement and the rise of mass food-borne illness outbreaks, now more than ever consumers are demanding to know where their meat comes from and how it was produced. Pasture-based operations already have a leg-up over conventional grain-based and feedlot operations. This instantly offers more opportunity to capitalize on the intrinsic value of the livestock.

Creating a Value Chain

In order to maximize profits, let’s take a look at a herd/flock.  There will typically be:

• Adult breeding stock

• Young replacement stock

• Young male non-breeding stock

• Adult non-breeding stock

To begin mapping out your value chain, identify which group of animals produces the most revenue.  In most small ruminant operations, this will be adult breeding stock. Now, ask yourself how many revenue producing opportunities does this animal present and make a list. While you may not be interested in actually following through on all of the ideas, the key is to get creative.

In addition to the animals themselves as revenue generators, consider the circumstances around the production.  For example, Owens Farm in Sunbury, PA offers Lambing Slumber Parties during lambing season where groups spend the night at the farm during the height of lambing season.  The Owens also host lambing clinics and Sheep Camp throughout the year as well as offer Adopt-a-Sheep each year that integrates into their educational programs and provides the fleece to the ‘adopter’ at the Repeat the exercise for what you consider to be your least revenue producing group. This group often includes unwanted young males from non-meat producing ventures and aged culls.

Dairy owners who don’t want their male offspring to head off to someone’s dinner plate right away may take the time to castrate and grow out the wethers for packing.  Adult non-breeding stock that are too aged or infirmed to be harvested for premium meat cuts can be turned into ground meat products for human or pet consumption.  Zoos, animal parks and carnivore rescue groups are often in need of meat sources. At the very least, they may be able to offer a tax break for the value of the stock if they have a non-profit status, as most do.  Consider using any or all of the four groups for targeted grazing.  Flocks of sheep are becoming popular for grazing under solar installations, however, don’t try this with goats as they tend to be more destructive to the equipment than sheep.

Even in death when you feel that your stock offers no more value, consider a variety of other ways in which they can continue to provide value for your overall operation—mortality composting for rich pasture amendment.  Don’t every underestimate the length of the value chain from your small ruminant.

Even after a long, productive live as a brood doe weaning twenty-nine offspring over the years, being “rented” out for targeted browsing  and the star of the show for numerous workshops, being humanely harvested at the end of her productivity and turned into a profitable batch of sausage, this old doe put the cherry on the cake when a restaurant customer requested a goat skull with a “nice set of horns”.  I had requested her head intact from the processor as a memento, as the old gal did have an impressive set, I offered her bleached skull that had hung on the side of my barn to him. Eagerly he reached into his billfold and peeled off a hundred dollar bill. When I declined the money, he insisted. “It would have cost me a lot more if I bought one off of eBay.”

This article was based upon Sandra Kay Miller’s presentation at the 2013 Pennsylvania Association for Sustainable Agriculture’s 22^nd Annual Farming for the Future Conference.

Thanks to the National Grazing Lands Coalition for making this article possible. Click on over to see the great work they do for all of us. Thank them for supporting On Pasture by liking their facebook page.