Sheep Industry News September 2023

Market Report

TYLER COZZENS, PH.D. Livestock Marketing Information Center

Prices and Production

A s the summer season draws to a close, weekly sheep and lamb slaughter levels continue to track similar to levels seen at this time last year – about 31,000 to 32,000 head of sheep and lamb slaughtered per week. Although slaughter levels are on par with last year, recent weekly lamb production has tracked about 5 to 10 percent lower than last year, which is due mainly to a comparable decline in weekly lamb and yearling dressed weights. The Livestock Marketing Information Center is forecasting lamb production to decline about 2 to 4 percent during the second half of 2023, due mainly to the continued trend of lower dressed weights. Although production levels are tracking lower, prices are expected to follow seasonal patterns. The three-market feeder lamb price (Colo., Texas and S.D., 60 to 90 pounds) has oscillated in recent weeks, but in general prices have moved seasonally lower. At the start of August, prices were around $160 per cwt., which is similar to last year but slightly below the five-year average of $180 per cwt. for this time of year. August is also when lambs on feed reach their seasonal low, which the U.S. Department of Agriculture’s Agricultural Marketing

Service reported was 42,800 head at the first of August. Typically, lambs on feed inventory levels move higher after August and peak around the month of November. With the expectation of more lambs moving into feedlots in the coming months, feeder lamb prices typically improve. LMIC is forecasting the third quarter three-market feeder lamb price at $175 to $180 per cwt. and the fourth quarter at $182 to $188 per cwt. For producers looking to market feeder lambs in the coming months, feed costs will be an item to watch. Nationally, prices in June – the most recent monthly data available at the time of this writing – for corn was $6.49 per bushel – 12 percent below last year. Alfalfa hay was $263 per ton – 7 percent above a year earlier. High feed costs translate to higher cost of gain in the feedlot. LMIC is expecting corn and alfalfa hay prices to move lower for the 2023-24 marketing year to $4.55 per bushel and $235 per ton, respectively. With a large portion of the western United States seeing a much-improved drought situation from previous years, improved range and pasture conditions provide more flexibility for produc ers to graze lambs longer and put on more weight before place

ment into feedlots. Placing lambs at a heavier weight translates to fewer days on feed and lower feed costs to get the lambs to market weight. Slaughter lamb prices (national, negotiated, live) have continued to climb higher through July and into August, which is welcomed news and a positive sign for producers. Especially compared to last year where prices steadily declined through the first three quarters of the year, finally reaching a bottom around $120 per cwt. in Septem ber 2022. This year, in late-July and early-August, slaughter lamb prices have been around $190 per cwt. and approached the $200 per cwt. mark. Prices have more closely aligned with typical pat

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