Sheep Industry News November 2024

Market Report

DAVID ANDERSON, PH.D. Texas A&M AgriLife Extension Service

Prices Slide Seasonally

L amb prices have been sliding since mid-summer. Much of this decline is seasonal, meaning that prices normally decline during this time of the year. This season, the main culprit appears to be lamb supplies. SUPPLIES Weekly domestic lamb and mutton production has exceeded production for the same week a year ago every week since April 20. For the year, production is 3.2 percent more than last year. In the last 10 weeks, production has been 6.9 percent greater than a year ago. On the positive side, the difference in production compared to a year ago is getting smaller. In the last four weeks, production is only 3.2 percent ahead of a year ago. On the slaughter side of production, both lamb and yearling and mature sheep slaughter have been greater than the same week a year ago almost every week since April. As with produc tion, the difference in the number of head processed each week compared to a year ago is getting smaller. Dressed weights have become culprit in increased produc tion. Since being lower than last year most of the year, weekly average dressed weights have been about 2 pounds heavier than last year. So as slaughter is moderating, heavier weights are

keeping production above a year ago. Slaughter and production greater than a year ago continues to be a surprise. Especially with a smaller estimated flock inven tory. Greater mature sheep slaughter is likely related to drought and the impact of lower prices and higher production costs. In time, greater slaughter might lead to some thinking about the potential for the inventory estimate to be an undercount of the flock. Lamb imports have added to supplies on the market this year. Total lamb imports for the year – through August – are 38 percent, or 58.4 million pounds, which is higher than in 2023. Imports in July totaled 29.5 million pounds, which was a record amount of imports in one month eclipsing the 29.3 mil lion pounds imported in June 2021. The increase in domestic production combined with greater imports indicates supplies in the third quarter were about 11 percent larger than the third quarter of 2023. Total supplies in the fourth quarter should be about 11 percent greater than the year before. In the face of more production, cold storage levels remain smaller than last year. The amount of lamb and mutton in stor age has slowly increased each month this year. Storage remain

ing restrained in the face of larger total supplies is an indicator of posi tive movement in retail channels. PRICES Lamb prices normally decline, seasonally, through late summer. Lamb prices reflecting heavy and light weight slaughter lambs have declined. National negotiated live slaughter lambs have declined from a peak of about $219 per cwt. in early summer to $165 per cwt. for the first week of October. The decline this year is larger than the normal seasonal decline. Sioux Falls, S.D., auction prices have declined more than the normal seasonal decline, going from almost

6 • Sheep Industry News • sheepusa.org