Beginning to Breed Cattle and running a Cattle Ranch Business

 

Many food sectors are having a hard time, especially regional economies. The combination of a backward dollar, falling international prices, tax pressure and a sharp rise in domestic costs are the perfect justification that led to the disincentive and loss of business abroad. But with some policy changes, there are activities that have great potential and can regain lost ground. The key, as always, is to anticipate.

For more than a century, the country was one of the largest suppliers of meat in the world, and recognized for its quality; But, in the last years, protagonism lost to hands of producers with less tradition in the heading. In 2005, America was the third largest exporter globally: it now ranks eleventh, surpassed by its Mercosur partners (Brazil, Paraguay and Uruguay).

The most paradigmatic case is Brazil, which during the 1990s imported meat and is now second in the ranking of exporters. Likewise, the advance of soybeans and other crops gained ground for the cows, not forgetting the state policies discouraging the sector. The opportunity to invest in American livestock is now, since it is a medium and long term business: due to natural issues of its process,

This is how it works –

The business of cows is related to the life cycle of the animal in its different stages. There are those who are engaged in breeding (they have cows and bulls and sell the calf) and those who opt for the rearing of the animal (buy the calves from the breeders, then feed them and sell the bulls – more than 300 kilos – to a greenhouse Which will be fattened to sell it to the refrigerator).

You can buy calves of 150/170 kilos average that will be sold, after the investment period of 365 days, in 280/320 kilos. The gain is the difference in weight, about 130 kilos between the calf and steer phase. It is important to clarify that the livestock business has very low climatic risk on natural pastures and generally has low mortality.

This is how you begin –

There are several ways to access the livestock business, directly related to the level of knowledge and money to invest. From small to large, the simplest and most economical way is through trusts, which offer interesting yields in both pesos and dollars, and where the investor obtains a profitability from a large scale business that he otherwise could not access .

The system is very simple: the trustee manages the business, manages the capital of all investors and then returns the result of its management through a performance. The minimum investment is from $ 40 thousand and the projected yield in pesos ranges from 35 to 40 percent, while in dollars some offer the devaluation rate plus a few points of interest.

The other options are dealing with the activity in a particular way or buying / renting a suitable field surface for the chosen scale of business. Obviously, in these cases profit margins and risk increase.