Investing on Dairy Cows

Have you ever heard of investing on dairy cows? It sounds funny, but it is a real thing! Here is how it works:

The investor buys heads of cattle (dairy cows), then he addresses to a specialized manager who rents them out for him at a selected breeder or farmer. The breeder provides work, buildings, equipment and land. He raises the cows, feeds them and pays for the illness and accident insurance.

Each cow who dies is replaced by another of the same quality, the owner suffers no loss of profits as everything is covered by the insurance. The farmer keeps the milk, manure and males.
The female offspring are shared between the farmer and the owner, after a levy designed to keep a young flock (this levy ensures sustainability of the flock).
Therefore one does not become a breeder... It is all about investing money.

At what interest rate? 

Image courtesy of [digitalart] / FreeDigitalPhotos.net

The owner (the investor) collects about 4-5% of its population a year in nature. He then has the choice between reinvesting its earnings (heifers will be added up to his flock each year, with an average growth rate of 4.2%, then the flock will double in 19 years) or sell.
If he decides to sell, the heifers due to him are sold as soon as they are adults.
In short, this is another investment not often proposed by bankers, but it is a way to diversificate passive income.


Small farmers can benefit from cattle he didn't have to pay for and owners (investors) can colaborate to grow our planet resources and get money from a real "tangible" thing.

An example of investing on dairy cows

There are two options for the return of benefits:
The grow option (keeping new born heifers and no yearly cash income)
A yearly cash income (by selling a fixed number of animals every year)

These are the costs and benefits.
- cost per head 1 167 €
- average yearly yield (in number of heifers) 4,20 %,


The thing is to start buying heads and chose the growth option for a number of years (let's say you grow your cattle) and then get the return of investing on dairy cows.

Let's say we start buying ten heads and then we buy two extra heifers for a period of five years.

Start 1 167 x 10 = 11 670
Buy two extra by year 1 167 x 2 = 2 334
In five years you will have 20 heads, worthy 23 340 wich will yield 980.28 euros/year

It seems that this idea comes from the the middle age, the old times of Richard Lion Hearted, where herd was considered as the real richness.
All this figures and conditions are samples here in France, to read more:
http://www.afic-ass.com/anglais/cadre_ang.asp?savoir=0&choix=ex
Cows will always be a growing market, what do you think?