dairy cow leasing

From what I know cows arrive in calf and calve down on the farm that there leased to. 10-15% of the value of the cows is paid for leasing 150 is the figure a friend of mine pays to lease cows. You have to replace cows with cows in the same lactation and same average ebi at drying off. Its very common in nz but their contracts are a lot more advanced than we have in Ireland. In nz cows are worth a good bit more than heifers, a lot of young managers buy heifers and lease them out to the farms they work on. 1st of June heifers are returned in calf and in good condition and are usually worth 500/700 more to sell as second calvers. Lads usually use this way to build stock numbers, when starting out. Line of second calvers would be sold and a larger number of heifers bought to lease the next year. Its defiantly not as lucrative in Ireland

Sam Kade wrote: »

Why would you have to replace the original cow you leased with a younger cow?

Presumably that's where the profit comes in for the lessor. Otherwise the lease will only be covering depreciation of the cow.
However it doesn't sound like a long term plan for someone to lease cows. If cows remain at similar prices year on year then anybody leasing cows will effectively be buying the cows with payment deferred for a year with the cost of the lease the interest.