1984 - Volume #8, Issue #4, Page #32[ Sample Stories From This Issue | List of All Stories In This Issue | Print this story | Read this issue]
Calf/Share Cow LeaseHarvey Applegate and his sons John and Jim run a beef cattle leasing business in Nebraska that may be unique to the business and is a plan they think might work for other livestock.
The Applegate lease plan, developed by Harvey more than 25 years ago, is unique in that no money ever changes hands between the Applegates and their renters. The renters pay their fee by returning calves to the Applegates.
Here's how the idea works: The Applegates lease cattle out for periods of 3 or 5 years. They send out bred heifers and then each year take 1/3 of the calf crop as payment. The renter keeps 2/3 of the calves. At the end of the lease period, the renters return the cows to the Applegates, who then send the cows to market. The renters have the option of buying the cows or continuing to rent them.
When the Applegates send cattle out they also send along a generous number of bulls as part of the service. If the renter wishes, he can provide his own bulls. The only requirement on the part of the renter is that he have a well-run operation and that he carry liability insurance.
"If an animal dies and there's a good reason, we replace it at no charge," John Applegate told FARM SHOW, noting that they try to remain flexible when times get rough. When paying "rent", the renter divides the calf crop up into three equal groups and the Applegates then chose one of the groups. The heifers are then bred and leased back out while the steer calves are sold, or traded for more heifers.
The lease program has been extremely successful for the Applegates over the past 25 years although they have had some bad experiences. "One renter went to his banker and put a mortgage on our cattle. We took our cattle back and the banker was stuck," says John.
John Applegate thinks the lease idea might also work well with hogs and other animals. "It's a good deal for both sides. Many young ranchers have gotten their start because of our lease program."
Contact: FARM SHOW Followup, Harvey Applegate, Sutherland, Neb. 69165 (ph 308 386-4770).
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