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| Seems to me there's two parts to this equation. Feeding pigs (which you feel there is little profit in) and owning pigs. So, the question you have to ask yourself is if you feel you can make money owning pigs long term (and enough to stay solvent short term).
Also, if you are going to borrow $600K to feed pigs and roughly another $300K to own pigs, what else could you do with that type of capital to get better returns? If you can put up pivots or pour concrete, have you looked at doing those as a side business? Maybe a bin or building dealership? Maybe just a bin erection crew. A seed dealership? A fertilizer brokerage? All of these businesses could probably be set up with much less capital and risk with more profit. They would also compliment your custom farming.
Would the hog enterprise interfere with your custom business? If you have to stop harvesting for a half day to go load hogs, will your customers be ok with that?
I looked at the custom hog thing a couple years ago and agree that it doesn't look too great from a cash flow standpoint. There's also the counterparty risk in a contract. Hog ownership has too much risk for a beginning farmer with limited capital, IMO.
If you really are considering hog ownership, maybe go the hoop route and feed a higher value product like a "natural" pork. Might be more margin in that and you would be doing something more labor intensive and less capital intensive. That would fit better as you seem to have excess labor and limited capital.
One last possibility is to find an established farmer and partner with him. Have them put up the building and then partner on the hogs. Maybe they would buy your half of the manure. You could provide all the labor. There are a lot of guys out there who would like the manure but don't want to raise hogs. Could probably be several ways to get fairly compensated. Might allow you to do this on a larger scale than what you were originally thinking.
Edited by Brandon SWIA 2/21/2012 08:49
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Wean to Finish questions
