Sharemilking: a snapshot - 2002

Abstract

Sharemilking is a contractual arrangement where one party (the farm owner) provides the infrastructure required for dairy farming, and the other (the sharemilker) provides the physical labour, management skills and some of the chattels or livestock required to operate the farm. Under the 50% agreement the sharemilker owns the herd, plant and mobile equipment. The sharemilker is usually responsible for all milk harvesting and stock related expenses, general farm work and maintenance. The sharemilker usually receives 50% of milk income and the proceeds from most of the stock sales. The sharemilker is usually largely responsible for farm management. Under the Variable Order agreement the sharemilker does not usually own the livestock and has minimal plant or equipment. The sharemilker’s expenses normally relate directly to milk harvesting. The percentage of income received is negotiated and the farm owner is often more involved in farm management than with the 50% agreement. The purpose of this report is to provide an outline of the concept of sharemilking as it applies to the New Zealand dairy industry in 2002. It is intended to: - Highlight to those involved in dairy farming, the value and scale of sharemilking. - To be a useful reference bringing together information about sharemilking in an easily accessible format. - Provide an outline of the situation as at 2002. It will serve as a benchmark for future examinations of the evolution of sharemilking. - To be a useful resource for those looking to have a greater understanding about sharemilking from the perspective of the dairy industry in other countries. - To be a useful resource for those considering a career in dairy farming. - To be a useful resource for those considering engaging a sharemilker. - To be a useful resource for those considering the possibility of applying the principles of sharemilking to other industries. - To be a useful reference for people in New Zealand who have little knowledge of the role sharemilking plays. Much of the information in this report is previously undocumented, as it is either industry specific knowledge, or an outline of normal practice.