Invest in my farm
New farmer sells bonds to investors and shares to consumers for home-delivered burgers and steaks
By Jessica Sims
MANOTICK — Paul Slomp uses a scythe to cut the grass around the fences on his 75-acre farm. He doesn’t own a car so from April to November he bikes 45 minutes (21 kilometres) every day from where he lives in the city to farm on rented land at Manotick Station outside urban Ottawa. He doesn’t own a tractor either – he barters some of his beef to use a neighbour’s when he needs one.
“I don’t mind the extra work – I have the energy. What I don’t have is the cash flow,” explained the 30-year-old.
Like many off-farm young people eager to start farms of their own, Slomp chose a Community Supported Agriculture (CSA) model for his farm. Yet while most CSAs sell vegetable and fruit shares to customers and in turn supply produce weekly, Slomp sells shares of meat. He also sells bonds to investors.
When he moved to Ottawa in 2009, Slomp wanted to farm. There was one problem – he only had $10,000 in personal savings and was eating into that to pay the rent. His farm was to be his only source of income. Banks wouldn’t finance him and the interest on any loan would have killed profits.
The Community Supported Agriculture model is popular with new, young farmers because it provides an easy initial investment. They sell shares at the beginning of their season and get cash up front. While vegetable growers can get product to members right away in the spring, Slomp could not. He needed to purchase his 14 Angus in April last year but they wouldn’t be ready to butcher and deliver to members until October. It wasn’t until August and September when most of his shares were sold.
So Slomp and a lawyer friend drafted bonds for his farm as a solution. They sold them for $500 each with a promise to pay 4 per cent interest every year, until paying back the investment at the end of three years. Slomp received $11,000 from around 10 investors as far away as Toronto. One investor purchased $5,000 in bonds. A vegetarian even purchased a bond.
Now in his first season, he has 120 members. For $255 a member receives a 10 lbs. box of beef every other month. For $510 members receive a 10 lbs. box every month. But with the $5,000 electric fencing system, $500 per animal for butchering and transportation costs, $1,500 to rent space in a freezer warehouse for the year, and $150 a month to rent a vehicle to make deliveries, Slomp lost $2,000. His goal? To earn a $40,000 profit each year from his CSA. Next season he thinks he’ll take home $15,000.
“I think a lot of the people who are running CSAs are new to farming, and I think it’s easier to start with vegetables than it is to start with a living creature,” Slomp explained. But demand is there, he said: “The response has been better than I expected actually.”
Slomp is far from a city boy. He grew up on a dairy farm in the Netherlands until his family moved to Alberta where they still milk 50 head. He spent years working with rice farmers and small-scale vegetables growers in Africa, and is currently the youth vice-president of the National Farmers Union.
Slomp figures he could get a high-paying job with the civil engineering degree he earned from the University of Alberta but he remains adamant that “it’s not about money.”
His small-scale production raising antibiotic and hormone-free, grass-fed beef includes intensive pasturing techniques that require moving his herd to different sections of grass every day. It’s not easy getting cows fat on grass.
“Logistics are more difficult for a meat CSA,” Slomp added. There’s the issue of storing the meat for the six months after butchering. Whereas vegetables can be dropped off anywhere for pick-up, meat has to be kept frozen and home delivery is best. Slomp’s deliveries take up five days every month. Each of his boxes contain ground hamburger, sausages or patties, roasts, and steaks. The types and qualities vary from month to month, but it allows him to get rid of all of his cuts, including ones consumers aren’t familiar with and usually avoid.
He hopes to eventually diversify his CSA shares. He’s working with another farmer who roasts coffee beans. Next year he wants to double his herd to 30 cattle. With that he might include a few beehives, put some ducks in his ponds, and graze some chickens, he says.
But he remains limited by his land. He doesn’t have a barn or a farmhouse.
“I would love to live on a farm with a family and things like that but right now I’m single. I don’t want to live on a farm by myself,” he said.
Slomp currently shares a house with eight other people. He describes his days working alone on his farm as an almost meditative experience. “You have all of this time to explore the ins and the outs of the world,” he said.