Sheep Industry News August 2021

Market Report

JULIE STEPANEK SHIFLETT, PH.D. Juniper Economic Consulting

Feeder Lamb Prices Post Record Highs

T his year, the American lamb industry has broken multiple records with record high feeder lamb prices, slaughter lamb prices and wholesale prices. The combined influence of tight supplies and strong demand is exerting pressure on markets. It is assumed that the ethnic market demanding lighter-weight lambs is driving the current run-up in prices, forcing lamb proces sors of heavier lambs to pay higher prices to secure supplies. The niche lamb markets at foodservice, retail and ethnic markets over lapping the two will play tug-of-war with lamb supplies. In the year ending March 31, “consumer demand for lamb increased consider ably compared to the same time period one year ago” according to IRi/Fresh Look Marketing for the American Lamb Board in June. There was a 27 percent increase in dollar sales at retail from a year ago and a 19 percent increase in pounds sold. As discovered in Midan Marketing’s Multicultural report to the American Lamb Board, one “factor that could be influencing lamb’s popularity in recent years is growing demand among first generation Americans from the Middle East and Southern Europe, where lamb is closer to a food staple in their diets.” Further, Midan explains, non-white meat eaters purchase lamb more often than white meat eaters. One in four Asian meat eaters have purchased lamb in the past month, while one in five Hispanic and black meat eaters have also purchased lamb. This year, feeder lamb prices flirted with $300 per cwt., bounc

ing between $250 and $292 per cwt. By June, prices settled closer to $250 per cwt. – a level not previously thought possible. On average, 60- to 90-lb. feeders averaged $261.41 per cwt. in June, up 5 percent monthly and up 57 percent from the COVID-low last summer. Prices in San Angelo, Texas, averaged $258.05 per cwt. in June, up 13 percent monthly and up 54 percent from a year ago. Prices in Sioux Falls, S.D., averaged $264.96 per cwt., up 4 percent monthly and 60 percent higher year-on-year. Slaughter lamb prices moved sharply higher in June, driven by tight supplies and strong demand. Live, negotiated slaughter lamb prices averaged $257.51 per cwt., 5 percent higher monthly and 41 percent higher year-on-year. The last time slaughter lamb prices topped $200 per cwt. (at $205 per cwt.) was July 2011 when domes tic and imported supplies were tight. In San Angelo, 100 to 150-lb. wooled and shorn slaughter lambs averaged $200.22 per cwt., up 27 percent monthly and up 57 percent year-on-year. Lambs in Sioux Falls saw $263.07 per cwt., up 18 percent monthly and nearly double from a year ago. Lamb prices at the market in New Holland, Penn., saw some monthly softening, but still sharply higher than last summer. Wooled slaughter lambs at the New Holland auction (Choice and Prime 1-3) averaged $280.28 per cwt. in June, down 3 percent monthly and up 26 percent year-on-year for 90 to 100 lbs. Heavier, 100- to 150-lb. lambs averaged $281.16 per cwt., down 2 percent

monthly and up 50 percent from a year ago. Hair lambs, 70 to 80 lbs., brought $265 per cwt. in June at New Holland, down 4 percent monthly (Choice and Prime 1-3). Eighty- to 90-lb. lambs averaged $253.02 per cwt., down 7 percent monthly. There were no comparable price reports published for last summer. It is common for feeder lambs to top $200 per cwt., not slaughter lamb prices. As slaugh ter lamb prices approach levels previously reserved for feeder lambs, the distinction between the two is blurred. The heavier-weight, traditional lamb mar ket will face continued pressure by the lighter weight, ethnic market to secure supplies. In general, desired weights in the ethnic market range from about 80 to 120 lbs., not as heavy

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