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Thursday 18 September 2014

Breed success by taking the pedigree route to riches

Published 09/10/2003 | 00:11

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Patsy McCabe, Blakestown Farm, Ardee, Co Louth, hosts a North Eastern Charolais Club farm visit to his herd. Potential breeders should go along to similar farm visits and join the breeding club before deciding to buy pedigree cattle

You can join the super rich club - or at least have the same interest by breeding pedigree cattle. TOM LYONS writes that quality commands a premium

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A RULE of thumb for many investors is to watch what the big boys are doing, and consider doing likewise.

And what Ireland's top businessmen all seem to be doing is taking off their shoes to don wellies and invest in pedigree cattle.

But is it worth following them?

The list of Irish business people investing in pedigree cattle includes some of the wealthiest men in the state.

It includes the chairman of Glen Dimplex Martin Naughton who breeds on his extensive lands at Stackallen in Co Kildare, founder of Ryanair Tony Ryan who breeds on his lands at Lyons Demesne, and Independent News & Media chairman Sir Anthony O'Reilly who operates out of a large estate at Castlemartin, breeding Charolais cattle.

Ryanair boss Michael O'Leary is also building up quite a herd at Gigginstown House, as too is former teacher turned Riverdeep millionaire Pat McDonagh who owns a number of farms including the 200-acre Skidoo stud farm in Ballyboughal.

Investing in pedigree cattle is certainly not for everyone but there are excellent returns to be made - if you know what you are doing.

Currently, there are well over 7,000 breeders of pedigree cattle in Ireland and this figure is growing rapidly especially among part-time farmers with other sources of income.

Over 80pc of these are small breeders with less than 10 breeding females on between 10 and 20 acres of land.

Four breeds dominate the Irish market in terms of popularity - Charolais, Limousin, Simmental and Angus. Entry prices for good quality breeding females range anywhere from ?2,000 up to ?15,000. These can then be expected to deliver yearlings that can be then sold on making ?1,000 profit and upwards after all costs have been paid, assuming of course that all goes to plan.

With the growing usage of artificial insemination, access to the genetic stock of top bulls is available for between between ?10 and ?60 a straw.

Each breed has a respective society which should be the first port of call for advice on becoming a breeder.

According to Nuala Hourihane of the Irish Charolais Society, which has 3,500 members: "Pedigree cattle are a good investment. In general, pedigree cattle deliver far better returns than commercial animals. It is possible to make money having pedigree cattle otherwise I don't think so many would be breeding them." However, she says most breeders see having pedigree cattle as delivering more than just financial returns but also returns in terms of the enjoyment of breeding them.

Jim Kelly, estate manager at Castlemartin Ireland's largest breeder of pedigree cattle, recommends any investor to buy quality right from the off.

"Pedigree cattle breeding is a sound investment decision that is becoming more and more popular, but you need to know what you are at - you need to have a good farming background to make any money, or employ a good stock man or professional manager to look after what are very high performance animals."

"This is not a quick-money business, but returns are increasing, especially with buyers coming down from the North with sterling to replenish their stocks following BSE."

"The market is there for the small breeder who can produce quality," he claims, citing small breeders who have achieved prices as high as ?10,000 for breeding females and ?15,000 for bulls this year.

However, he cautions any potential breeder to buy the best quality animal they can possibly get based on appearance, pedigree and increasingly Best Linear Unbiased Predictions which predicts what particular animal's progeny can be expected to be like.

According to one part-time farmer who has switched from holding commercial to pedigree cattle, there are "decent returns to be made. Pedigree cattle deliver far greater returns than commercial cattle. "With more and more farmers going part-time, getting into pedigree breeding is engaging more and more people's interest," he continued.

"I have one stock bull and 10 heifers. This yields a good return with each heifer yielding on average a calf a piece within the year which you can then sell on as yearlings for say about ?2,500."

It is possible for the small breeder to clear over ?1,000 per animal when all costs are paid, he claims.

"People buying houses in the country with land attached might also consider them as an investment as well as way of life." he continued. There is also a good social element to having pedigree cattle that many people find attractive," he claimed.

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