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Before we get to the report I hope you had a happy thanksgiving and enjoyed lamb or chevon over turkey. For the week ending November 27th the Midwest sheep and goat market was too light in volume to establish a true trend. Of the sales typically profiled for this report Centennial Livestock in Fort Collins Colorado was the only one to host a sale. They sold 1,368 head on Wednesday Nov. 24th. The uptrend continued in Colorado with most wool and hair lambs $15-$30/cwt higher. Wooled feeder lambs weighing 60-80 pounds were $60-$70 higher. Slaughter goats in that 50-70lbs weight range were $10-$30 lower on thinner trade. Again I wouldn’t take one sale as the general market trend for the week, but that’s what there is to report on. Where we don’t have a lot of actual sales data this week I want to address a question that was sent to me by a listener of the report. They wanted to see lamb import data to the US. As they talked with a fat lamb buyer, tight available imports of lamb could be part of the reason we are seeing the strong start to the fall lamb and goat market. The data I could find comes from USDA Economic Research Service and gives us lamb import data through September. The next report will be released in early December and should shed light on October and possibly November lamb import data. From my view the data does not suggest that up to September the US has seen a decrease in lamb imports. Rather it’s the opposite looking at data from 2019 and 2020. According to the USDA data the US has imported over 26 million pounds in August and September. The peak so far for 2021 was in June at 29 million pounds. September is an interesting time for lamb imports. In 2019 the US imported 9.4 million pounds of lamb, in 2020 the US imported 15.9 million pounds of lamb and in 2021 the US imported 26.04 million pounds of lamb. While that gives a general indication of increasing lamb imports into the US lets look at the January through September imports for 2019 (167.17 million pounds), 2020 ( 155 million pounds) and 2021 (198.92 million pounds). Lamb imports are definitely on the rise in recent years and it will be important to see the October and November data to see if there was an abrupt change in imports. The good news is that the imports signal a growing domestic demand for lamb in the US. Now the challenge will be for US producers and processors to get US lamb to compete with import prices. First though the herd needs continued expansion to even come close to meeting domestic demand. Also it’s great that producers are being paid near record prices for their livestock currently, but we must be kept in mind that high prices can also ration demand. So far it appears the lamb and goat market has not found that price level yet, but it’s a possibility for the coming future as the market looks to explore record highs in the coming months with the current trend. Other USDA data possibly useful to the lamb and goat market this week was USDA cold storage reports. It showed that stocks of lamb in commercial cold storage increased 6% from October 2020 and 6% from September 2021. What that means is there is 27.16 million pounds of lamb and mutton in cold storage compared to the 25 million pounds in September 2021 and October 2020. Lamb wasn’t the only red meat to see an increase in cold storage. Beef in cold storage was up 9% from September 2021. Meanwhile pork was down 6% from September 2021. Big picture for lamb is that stocks are still almost half of what they were pre pandemic.
On the retail front last week’s USDA retail data showed going into Thanksgiving week lamb cuts retail activity index was 117.52% higher compared to the prior week. The roasts saw sharply higher ad space while chops ad space was 88.27% lower. Rack, Bone-In, Boneless and Semi-Boneless leg and Ground Lamb were the most widely featured item among the Lamb features as prices were mixed.
Other commodity markets were on the rise until Friday. A new covid variant in South Africa sparked a market wide sell off that included grains on Friday. The trade was on thin volume though which means the market could rally back on Monday as traders see value in the sharp selloff. Grains in particular continue to have a strong case for higher prices as a La Nina weather pattern could impact Argentina and Brazilian crops. Meanwhile fertilizer prices and availability are still in question as plans are slowly made for the 2022 growing season in the US.
This week Kansas was the only state to produce a hay report and showed steady cash and slow movement for hay as harvest gave its final breaths. Next week we will see if a completed harvest finally starts to get the market moving.
This report was produced before the Friday weekly slaughter data was available, but as of Wednesday the US lamb slaughter was at 24,000 head. That was 3,000 less than last week and 1,000 less than the previous year. Packing plants idled down on Thursday for Thanksgiving and likely only ran limited schedules on Friday.
Lamb import data from USDA https://www.ers.usda.gov/data-products/livestock-and-meat-international-trade-data/
Clay Patton has the audio recap of the report here: