Beef is raised in three phases before it is processed: calves are raised on pasture and range land, as feeder cattle they feed on pasture, crop residue, and range land, and finally they go to feedlots, where they are fattened for slaughter. Feeder contracts are a type of futures contract based on young cattle that are sent to feedlots in preparation for slaughter. The Chicago Mercantile Exchange first introduced a feeder cattle contract in 1971.
It is important make sure the agreement is clear as to whether a bailment or an actual sale of the animals is intended. In order to constitute a bailment and not a sale, a fattening or raising agreement should provide that the owner agrees to provide the animals involved to the feeder with the owner retaining title to the animals, and the feeder or raiser is to feed or raise them for sale as the owner deems proper. This form is a sample of a sale rather than a bailment.
Arkansas Purchase and Maintenance Agreement for Cattle — Feeder Contract is a legal document designed to outline the terms and conditions of purchasing and maintaining cattle through a feeder contract in the state of Arkansas. This agreement is crucial for both the buyer and seller in ensuring a transparent and mutually beneficial relationship in the cattle industry. The Arkansas Purchase and Maintenance Agreement for Cattle — Feeder Contract typically includes the following key terms: 1. Parties: This section identifies the buyer, known as the "Feeder," and the seller, known as the "Producer" or "Seller," involved in the agreement. 2. Sale Terms: This outlines the purchase price for the cattle, payment terms, and any additional costs associated with the transaction, such as transportation and insurance. 3. Cattle Description: This section provides a precise description of the cattle being purchased, including breed, sex, age, weight, and any other notable characteristics. 4. Delivery Terms: Details regarding the delivery of the cattle, including the agreed-upon location, date, and specific requirements for transportation. 5. Health and Quality Assurance: This section covers the health history and quality standards that the cattle must meet, including required vaccinations and certifications. 6. Maintenance Responsibilities: Defines the responsibilities of both parties regarding the care, feeding, and veterinary services provided to the cattle during the agreed-upon period. 7. Risk of Loss: States who bears the risk of loss or damage to the cattle during transportation or while in the care of the buyer. 8. Breach and Remedies: Outlines the remedies available to the non-breaching party in case of a breach of the agreement by either party. 9. Duration: Specifies the time period for which the buyer will maintain and feed the cattle, typically referred to as the feeding period. 10. Termination: Conditions under which the agreement may be terminated, including default, force majeure, or any other pre-agreed circumstances. 11. Governing Law: Specifies the state laws of Arkansas that will govern the agreement in case of any disputes. Common variations or types of Arkansas Purchase and Maintenance Agreement for Cattle — Feeder Contract often include specific provisions tailored for feeder cattle or cow-calf operations, lease-purchase agreements, or contracts involving specific breeds, such as Angus or Hereford cattle. In conclusion, the Arkansas Purchase and Maintenance Agreement for Cattle — Feeder Contract is a comprehensive legal document that clarifies the rights and obligations of both parties in the purchase and maintenance of cattle within Arkansas. It provides a framework for a transparent and mutually advantageous relationship between the buyer and seller in the cattle industry.
