Contract Rearing
What is Contract Rearing?
Contract Rearing involves the movement of livestock from the owner’s farm for rearing on contract by another farmer. The most common arrangements are where replacement heifers leave the dairy farm to be contract reared on a drystock farm and subsequently return to the owner in-calf and ready to commence milk production post calving. Due to the expansion of the dairy herd, the reduction in the stocking rate limits for many derogation farmers and the reduction in the availability of leased land, there has been an increase in demand for such services. Based on figures from ICBF, it is estimated that there are currently over 780 dairy farmers whose heifers are being reared on contract and a similar number of farmers providing a professional rearing service. There are also cases where beef animals are reared on contact, although these arrangements are in the minority.
What makes contract rearing attractive to livestock owners?
- Reduced farm stocking rate, freeing up more ground for milk production
- Increased milk output and should result in more profit
- Reduced workload on farm
- Fewer groups of livestock
- Reduces requirements for calf house accommodation and slurry storage where calves/weanlings/ yearlings are housed on the rearer’s farm over the winter thus reducing the demand for capital investment in housing and slurry storage
- Reduces the requirement for leased land and the associated costs that come with outblocks
- Where the correct rearer is sourced, performance levels may improve as more attention can be focused on the rearing enterprise.
Why might a potential contract rearer choose this as an enterprise?
- No requirement to financially invest in purchasing livestock
- Steady monthly cash flow as payments are often made on a monthly basis;
- Removes the associated risk of volatile markets and price
- May complement an existing farm enterprise
- It is potentially more profitable;
- Animals may be more docile
Useful Links
Webinar
A Contract Rearing webinar took place on Tuesday, 14 January 2025,
- Ruth Fennell, Teagasc covered the rearing arrangement and costs structure
- Damien Barrett, DAFM spoke about the importance of considering TB in contract rearing arrangements
- Paidi Kelly, Cork and John O’Connell, Leitrim discussed the contract rearing arrangement they have in place
Specimen Agreements for the Contract Rearing of Replacement Heifers
Teagasc have prepared two specimen documents on contract rearing of dairy heifers.
A flat rate heifer rearing agreement.
This document outlines the key areas for consideration in contract heifer rearing including duration of contract, who pays for the different inputs and agreed rate of payment?
Download Flat Rate Heifer Rearing Contract March 2021 (PDF)
A weight bonus heifer rearing agreement.
The key difference in this document is that payment is linked to achieving agreed target live-weights at critical milestones in the heifer rearing cycle.
Download the document: Heifer Rearing Contract March 2021 Weight Bonus (PDF)
See also booklet in support of the specimen heifer rearing contracts.