Sheep Industry News January 2024

Market Report

CHARLES MARTINEZ, PH.D. University of Tennessee

Year in Review

H appy New Year to the readers. Hopefully, everyone had a great holiday season. Thank you to the readers for your comments and suggestions throughout last year. As we head into the new year, a visit to a year ago and where the current market is can us help think about the year ahead. Some sectors seem too similar to last year, but lamb prices have some positivity when looking through the details. RETAIL PRICES In the most recent U.S. Department of Agriculture retail sum mary price report, there has been a mixed bag of signals from the consumer sector. From a retail perspective, prices are not far off from the previous year. The current feature rate is at 7.8 percent compared to 11.3 percent from a year ago. For a refresher, the fea ture rate is the number of sampled stores advertising any reported lamb/veal item during the current week, expressed as a percent age of the total sampled stores. Thus, lamb is being featured at a lower rate, but still positive throughout the stores. Prices are steady compared to a year ago, with chops holding par and racks being the current price leader at $15.19 per lb., which is $0.55 per lb. higher than last year at this time.

WHOLESALE MARKET The lamb cutout is down 2.4 percent compared to a year ago at $464.67 per cwt. June was the lowest valued cutout value for 2023, but since then, the cutout has increased approximately $32.80 per cwt. This is the highest value since December 2022. Thus, the beginning of 2024 is looking similar in trend to last year. Both the Hindsaddle ($509.28) and Foresaddle ($573.97) values in November have increased in the last two months lead ing into the end of the year and are higher than last year. While wholesale prices have been increasing the last few weeks, the slaughter numbers are up compared to the previous five-year average and last year. Thus, while slaughter numbers are up – 42,000 weekly head slaughtered in early December – prices are holding relatively steady, which indicates strong demand for domestic lamb product. While slaughter is up, weekly slaughter dressed weights are oscillating around 60 pounds, which is ap proximately 10 pounds lower than compared to a year ago. Thus, the market is slaughtering more head than a year ago, but total production is down. Given that the national flock has been constricting, tighter supplies lend to stable to higher prices as we head into 2024.

FEEDER LAMB PRICES As we end the year, the three-market (Colorado, South Dakota and Texas) feeder (60 to 90 lb.) lamb prices of $248 per cwt. are ending stronger than any time in 2023, while also being the high est since the summer of 2022, when it was $248.06 per cwt. In South Dakota, prices are above the average at $266.45 per cwt. for 40 to 60 lb. lambs, which is up from $202.83 per cwt. this time last year. In New Holland, Penn., prices are even higher and hold ing steady in the low $300s per cwt. Thus, the slaughter segment of the supply chain is showing some steadiness with smaller dressed weights. That cre ates demand for feeders, as space opens up with each week. Feeder prices are

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