Sheep Industry News October 2025

Market Report

Charles Martinez, Ph.D. University of Tennessee

Higher Prices Throughout the Supply Chain

A s the calendar year turns to the last quarter of the year, sheep and lamb prices across the supply chain are higher in compar ison to last year, which is refreshing to write about compared to months past. Retail Enough time has passed since USDA-AMS altered their lamb retail reporting such that yearly comparisons can occur again. Retail outlets are finding value in featuring lamb products in the meat case and nudging consumers to lamb this year. In the first week of September, the feature rate was 21.2%, 11.1% higher than the previous week, and 6% higher than last year. The fea ture rate is the amount of sampled stores advertising any reported item during a current week, expressed as a “percentage” of the total stores (24,824) sampled. Additionally, the activity rate in the first week of Sep tember was 5,460, an increase from 5,431 in the previous week, and up from 3,930 last year for the same week. The activity rate is a measure of the absolute frequency of feature activity equal to the total number of stores for each advertised item (i.e., a retailer with 200 outlets featuring 3 items has an activity index of 600). The latest average feature retail price (August) was $11.20 per pound, 21% higher than 2024 ($9.30 per pound) and 29% higher than the prior five-year average ($8.68 per pound). The retail reports and prices are positive and signs that retail demand is remaining strong, if not increasing. Wholesale Wholesale lamb cutout values have steadily increased since July, hitting a yearly high of $491.40 per cwt in late August and gaining 6%

between the first week in January ($460 per cwt), and early Septem ber ($488.01 per cwt). Compared to last year, the cutout value was $14.41 per cwt (3%) higher and $29.91 per cwt (6.5%) higher than the previous five-year average in early September. A driver of the recent increase was boxed lamb shoulder prices, increasing from $399.33 per cwt in late June to $454.48 per cwt in early September (a 14% increase). From a historical price perspective, the cutout value usually stabilizes or trends downward in the last half of the year, but this year, it is rising and given the retail activity, prices might have some more upward movement, or stability, which is a positive sign for the supply chain. Slaughter Through the first week of September, weekly lamb and yearling slaughter is averaging 37,250 head per week, with total lamb and yearling slaughter approximately 1.3 million head or 2.4% higher than in 2024. Dressed weights have averaged 62.8 pounds so far this year, 0.6 pounds heavier than last year but 3 pounds lighter compared to the previous five-year average. Total lamb production year-to-date is 4% larger compared to last year but 1.3% lower than the previous five-year average. Tighter total supplies are likely supporting the higher cutout value. Weekly slaughter numbers are expected to seasonally increase for the rest of 2025. The question will become if there will be increased total production such that it pulls down wholesale prices. Prices Feeder lamb prices (60- to 90-pound) in the 3-market average (CO, TX, SD) mimicked last year’s price trends, with prices surging in the first quarter of the year, decreasing during the summer period and then increasing going into September. Prices started 2025 at $255.92 per cwt, peaked at $345 per cwt in February, and then fell to a yearly low of $197.78 per cwt in August. In early September, prices were at $241.40 per cwt, 7% lower than 2024, but 26% higher than the previous five year average. For 60- to 90-pound slaughter lambs, the 3-market (CO, TX, SD) prices have had some positivity. After peaking at $294.10 per cwt in May, prices declined and were at $222.97 per cwt in the first week of September, 20% higher than last year and 22% higher than the previous five-year average. The decrease in September was expected as prices tend to bottom out at yearly lows in the summer and then increase throughout the rest of the year. September prices might end up being the floor for the year, and fundamentally with increased retail demand, prices could finish the year at levels the not seen in a while.

6 • Sheep Industry News • sheepusa.org