The economics of cow-shares in Canada and good news for Calgary milk lovers

A happy Vancouver area cow-share member getting milk from Bert Jongerden at one of several Vancouver-area drop off points for Home on the Range.

A happy Vancouver area cow-share member getting milk from Bert Jongerden at one of several Vancouver-area drop off points for "Home on the Range". Gordon Watson photo.

Here’s some advice Gordon Watson recently gave to some folks who are considering establishing a cow-share dairy operation in the Calgary area. Gordon Watson is associated with Alice Jongerden’s Home on the Range farm near Chilliwack B.C., just a little east of Vancouver, which may well be Canada’s largest raw milk cow-share operation.

“Here is a thumbnail sketch of what we’ve learned in a year and a half:

A cow on a mainly grass-fed diet will produce an average of three gallons of milk per day. One gallon is four quarts. A quart is 32 fluid ounces. A liter is 39.36 fluid ounces. Forget the metric system and use American measures. The same people who are tuned-in to real food are intuitively opposed to globalization, which was what the metric system was created for; choose you this day whom you will serve

On the premise that a household will use a gallon of milk a week, then one cow will supply 21 households. So it takes a group of about 21 shareholders to underwrite one cow in production. Remember ; that cow will be dry for two months a year.  Two cows in milk will pay the overhead and provide half a day’s wage for someone who will do the stoop labour. Six cows in milk is a full time job at industrial wages. By the time you have 20 cows in milk, you should be making enough to be able to pay for a piece of property. That model is best suited to two families who will share the work

We have determined that the Agister (farmer) has to get $5 per quart in order to make it worth her while. That amount is what the shareholder winds up paying by the time the REAL MILK is delivered to the depots in Vancouver, 80 miles from the farm. It is a major mistake to try to provide the REAL MILK at a price too low. I spoke with a lady in a small town in BC who’s selling milk for $2.50 a liter. She lives on a farm which is her family property, paid for. I told her that she cannot even produce it for that price, all things considered.   So she’s subsidizing her customers. If she wants to do that as a labour of love, more power to her. But if you want to have the raw milk dairy go as a long term proposition, everyone has to get paid properly. Otherwise  it’s only a matter of time before it goes out of business as its capital dwindles because of inflation.

We are using the figure of $7 per day, as the cost of keeping a cow in the Lower Mainland … some of the best dairying country in the world. I believe that figure is actually too low, by the time we get more data. The price to keep a cow in milk in Calgary, may be quite different. I expect that – taken year-round – it would be significantly higher there. So the REAL MILK has to come in at a higher price, too.

The beginning farmer ought to be aware that while some cows are in milk, others have to be kept around not producing. At the moment we have 14 cows milking, with five pregnant to come on stream next spring, when the current ones dry off. As well, we are constantly on the look-out for cows for sale, and selling-off cows which don’t fit into our herd. The game of dairying requires juggling demand / supply, with the natural cycles of the cows, the availability of replacements, the weather … you name it. It is not for the faint of heart … people who do it, do it because they love it. The last reason someone should get into it is, because, at the moment it may look like it’s very profitable!

Lately we are seeing a movement for the 100 mile diet because that’s about the limit where someone can produce a foodstuff, drive it to market in a city where the food will command a worthwhile price, then be back home the same day. That’s a long day, though. So a start-up raw milk dairy should find a farm within 100 miles, max. of downtown Calgary.

It’s very important for someone who’s starting up to realize that managing the cows / doing the farm chores, is about 1/3 of the overall effort in getting the dairy products to the shareholders. Managing the ordering then doing the actual delivery, are no small tasks. If a raw milk dairy were to start up in a situation where shareholders come to the farm to get their own milk then the price could be lower

It’s crucial, though, for someone starting out to realize that hyper-inflation is underway. At the moment, the financial tide seems to be going out as commodity prices fall. But that’s the ‘water’ receding from the shore before the Tsunami of high prices comes roaring back, within the next year. Prices of hay, feed and gas = everything = will reach heights that people cannot imagine today. So a firm lease on a piece of pasture is absolutely essential for a raw milk dairy to make it past one year. As well, a secure supply of top-quality hay is crucial.

It is a cruel matter of fact that horses are starving in the Fraser Valley, and everywhere, because people who were living beyond their means cannot pay today’s price for hay. A lot of expensive ‘lawn ornaments’ are headed to the slaughterhouse. The price of good hay is going nowhere but up. As it does, the price for REAL MILK produced via cowsharing will go up accordingly.

The market for dairy cows is difficult for us right now. Paying attention to what comes available, we have purchased cows anywhere from $600 to $2000. Since word has got around in the valley about our operation, farmers who are part of the quota system are covetous, and resentful, thus unwilling to sell us a cow. Lately, we are looking to import Jerseys from Washington /Oregon. Someone starting out in Calgary would be better off not mentioning what they intend them for, or they will find cows hard to come by.

Our milk is very expensive milk … almost three times what the ‘homo milk’ sells for. People are happy to pay it because they can taste the cream. Thus, besides being real food with real, available nutrition, it is a gourmet food. Our herd is all-Jersey with one Guensey. Jerseys and Guernseys have the high cream content, which is what people want in REAL MILK. Our shareholders are informed consumers … they know that all the propaganda about “high cholesterol’ is bunk.

The depot system is crucial to the success of a raw milk dairy starting up. Our depots are all provided by people who are bending over backwards to help us. They do not make any money at it. So it’s crucial that a start-up dairy has connections to people who will lend their garage / basement / storage room to the shareholders out of goodwill. Health food stores may be sympathetic to the general idea, but when it comes right down to it, most of them don’t have the nerve to make space for a refrigerator. They are too worried about the legal controversy.

The herdshare concept will work as long as it does not get away from assertion of private property rights, over into commerce.

Another key concept is that the shareholders are underwriting the dairy in advance. This is the exact opposite of how the commercial food supply system is working. The retailers have about 3 days’ stock on the shelves. They operate on the ‘just in time’ system. So part of the task of a start-up raw milk dairy is to re-educate people about food security. At first, it seems awkward. But in the long term, it pays off in several ways, particularly in money because paying for something in advance eliminates usury, which is an absolute drain. Our operation grew from one cow to 14 in milk, now, over 18 months without paying one cent in interest on borrowed money to the banksters. Usury is poison to real free enterprise

In our operation, Alice Jongerden operates her company as a business which bills each shareholder for services rendered. She pays GST on the amounts billed. Her company does not own the cows … we do. Each shareholder has an undivided interest in the herd, as an entity.

Someone starting a raw milk dairy in Canada could simply copy our shareholder agreement. Or they could copy the one used by Wild Thing Organics, in Christina Lake BC. Or, there are several more examples on the website of RawDairy on Yahoo Forums, some drawn-up by lawyers.

To leave off on a positive note : getting a raw milk dairy going will be worthwhile in the long run. The market for dietary supplements / nutriceuticals such as colostral milk, has only begun to be developed. Products such as X-factor butter oil, and immune milk will make such specialized dairying very profitable as “low tech bio-tech” comes in to its own. For those who want to do it, a raw milk dairy is the foundation for a farm store where True Foods will be the theme. A study has shown that once a farm store has 40 different items, it becomes a destination for people to shop.”

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8 Comments

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8 responses to “The economics of cow-shares in Canada and good news for Calgary milk lovers

  1. thebovine

    Just as a further recommendation to throw my two cents worth in, I’d advise not going with Holsteins (the black and white cows) if only because their milk is predominantly A1 beta-casein, the kind that’s implicated in all kinds of health problems. Guernseys and Jerseys produce more of the A2 beta-casein, which many consumers in Britain, Australia and New Zealand specifically look for. Strangely, beta-casein type awareness seems to be making pretty slow inroads in the North American consciousness, but for someone starting out, why not choose A2 cows — seems the safer and healthier option to me.

  2. Sarah

    For those of you who are considering establishing a cow-share dairy operation in the Calgary area. Please let me know. My family and I would like to be shareholder(s) I know of many who would love to be a part of this program.
    gin20ette@hotmail.com

    • RICHARD BARRETT

      HI SARAH, I HAVE A PLAN FOR CALGARY. THIS IS THE FIRST TIME THAT I HAVE POSTED IT. NOT COW SHARE BUT A CO-OP OR COMMUNITY OWNED FARM. EACH PERSON HAS ONE SHARE FOR ONE HUNDRED DOLLARS. 10,000 SHARES= MILLION DOLLARS. WE SHOULD BE ABLE TO GET 120 ACRES WITHIN ONE HOUR DRIVE . I WOULD PREFER TO LEASE TO OWN AN EXISTING DAIRY FARM FROM A FARMER THAT DESIRES TO RETIRE IN 3-5 YEARS. EXTRA WORKING CAPITAL WOULD COME FROM MEMBERS AT 5% ANNUALLY AS NEEDED.
      ANYONE WORKING ON IT WOULD RECEIVE FIVE DOLLARS CO-OP BUCKS PER HOUR WHICH WOULD GO TOWARD MILK , RANGE FREE CHICKENS /EGGS , STONE GROUND FLOUR /BREAD, HONEY, AVAILABLE HORSES FOR FARM WORK/ RIDES PLUS ANYTHING ELSE THAT THE MEMBERS WISH TO WORK AT TO MAKE IT HAPPEN. MILK AND PRODUCE WOULD BE DELIVERED TO CHURCH PARKING LOTS TO LOCKED COOLERS WITH MEMBERS ONLY HAVING KEYS. BECAUSE OF LAWS, NOTHING COULD BE SOLD. MEMBERS WOULD PREPAY AND RECORD WHAT THEY RECEIVE. EACH CHURCH WOULD RECEIVE 10% OF THE GROSS SALES. ON FARM PROFIT IS FOR GROWTH AND DEFENSE.
      ON A PERSONAL LEVEL , I, RICHARD BARRETT GREW UP ON A MIXED FARM FIVE MILES FROM BELMONT, MANITOBA. IN THE FALL OF 2009, I HEARD ON THE NEWS ABOUT MICHAEL SCHMIDT BEING CHARGED. THEN MY RESEARCH BEGAN BECAUSE I WAS SHAKING MY HEAD IN DISBELIEVE OF WHAT THE HEALTH AUTHORITIES POSITION WAS BUT NOW I KNOW WHERE THEY HAVE GOTTEN THEIR INFO FROM. ON MY WAY TO SEE MY BROTHER IN EDMONTON WHO DIED OF CANCER, I STOPPED IN LACOMBE AT ALBERT KAMPS’S WHO IS ON THE ALBERTA MILK BOARD . I ASKED HIM IF HE KNEW OF ANY FARMER THAT DOES COWSHARE. HIS REPLY , “IF I EVER HEAR OF ANYONE DOING THAT, I WILL PHONE THE POLICE AND HAVE THEM CHARGED. THE ONLY WAY A PERSON CAN DRINK MILK IS IF THEY OWN THE COW AND IT IS ON THE SAME PARCEL OF LAND OF WHICH HE LIVES ON.” ABOUT TWO WEEKS LATTER I NOTICE A BUSINESS CARD IN MY MAIL BOX FROM THE LOCAL AG. INSPECTOR. I PHONE AND HE TELLS ME TO CALL THE RED DEER OFFICE.
      I PHONE AND IN THE COARSE OF THE CONVERSATION HE STATES,
      “WE HAVE RECEIVED A COMPLAINT IN THE RED DEER OFFICE THAT YOU APPROACHED A FARMER TO BUY MILK. HAVE YOU APPROACHED ANY FARMER BEFORE TALKING TO THAT FARMER?” I REPLIED , “NO”. HE CONTINUED,”HAVE YOU APPROACHED ANY FARMER SINCE YOU SAW THAT FARMER?”
      I REPLIED, “NO”. THEN CAME THE WARNING, “LET US MAKE IT CLEAR NOW, DON’T ! WE HAVE A LOT OF EARS AND EYES OUT THERE AND YOU WILL BE IN BIG TROUBLE IF YOU DO. WE HAVE INFORMED OUR PRODUCERS THAT IF ANYONE APPROACHES THEM THAT THEY ARE TO IGNORE THEM AND WALK AWAY OR ELSE THEIR LICENSE WILL BE IN JEPORDY.” IN THE END AFTER A HALF HOUR HE SAID TO SUBMIT MY PLAN AND HE WOULD TAKE A LOOK AT IT. I ENDED THE CALL BY THANKING HIM.
      SO START TAKING – NAMES, PHONE #’S, E-MAILS,
      MY E-MAIL IS fuwmilk@telus.net
      fuw stands for FRESH UNPASTEURIZED WHOLE

  3. Thanks for the informative post! You mention being able to ‘copy our shareholder agreement’, any chance of making that a link to the agreement? Or, if it is already on your site somewhere, can you point me to it?

    Thanks,

    HDR

  4. Natalie

    I haven’t tried raw milk but I’d like to and would possibly be interested in becoming a shareholder. My daughter is allergic to milk, so I’m interested in trying raw milk to see if there is a difference. Please let me know if there are any opportunities to purchase raw milk near Calgary.
    Thanks
    Natalie
    natiefisher@hotmail.com

  5. Hello Natalie,
    If you need a farmer to milk your grass-fed cow… simply contact the amazing couple at Wild Thing Organics at Christina Lake in southern BC.
    http://www.wildthingorganics.com
    Karen and Kurtis – amazing people! Their shipments are coming in twice weekly to Riva’s Eco Store and a Nutritional Therapist in Cougar Ridge.
    It is yummy stuff. The butter, whey and cream cheese you can make with your daughter is fabulous. Get your Nourishing Traditions cookbook and you’re set!

    -Michelle

    • Kapil

      Hi Michelle,
      Can you help me in where to get raw milk in Calgary .
      Thank you in advance
      Kapil

    • Natasha

      Hello Michell,
      I’m searching the web looking for some A2 milk supply in Calgary. Your post looks very promising as I live near Cougar Ridge. But could not find the place 😦 Do you think you could help me out here?
      I would greatly appreciate it!
      Natasha

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