| | Supply seasonality | Lamb weights | Consumer and packer preferences | Breeds | Marketing costs | Live weight versus rail grade sales | More information | Return to livestock marketing page
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Supply Seasonality
Supply seasonality refers to the normal fluctuations in the supply of fresh lamb on the market within the year. Lamb supply seasonality is related to the breeding pattern for sheep. In general, the supply of lamb increases beginning in mid-June and peaks in August and September. Lamb prices decrease as the supply grows from June though early fall. Management practices, such as changes in the breeding season or feeding program, can help time the marketing of a producer's lambs for a higher priced period.
Lamb weights
Lamb producers must be aware of how their product is accepted by consumers and packers. Research into consumer acceptance of lamb has concluded that most consumers prefer a lean product. Different breeds finish at different weights and ewe lambs finish at lower weight than ram lambs of the same breed. Wether lambs are intermediate in their rate of finish. Producers should ensure that lambs are marketed when they are finished, rather than when they are overfinished.
Consumer and Packer Preferences
Consumers have shown no significant preference for meat from wether lambs over ram or ewe lambs provided that each type has the same degree of finish. However, ram lambs are leaner and generally have a better rate of gain compared to wether lambs. Therefore, there may be an economic advantage to keeping ram lambs intact, as long as the feeding season does not significantly overlap the natural breeding season.
Producers should be aware, however, that US packers discount intact ram lambs. Since castration should be done as soon as possible after birth, it is a good idea to consider at that time what markets one is likely to want to use. Also check discounts on ram lambs or any other conditions which might limit their marketing opportunities.
Lambs destined for feedlots should always be castrated at birth.
Breeds
Producers should choose breeds for their ewe flock that have the production characteristics - prolificacy, milk production, grazing ability - that meet the needs of their production system. Most Alberta lamb markets want lambs that finish at 100 to110 pound (45 to 50 kg.) live weight all through the year. Many of the common breeds of sheep are suitable for this market weight. Hwever, producers with smaller ewes should choose a ram of a larger terminal sire breed with the frame size to be lean in this weight range.
Most breeds lamb during the spring, late winter or early summer. A breed or breed cross that can lamb out-of-season should be considered if the producer wishes to take advantage of the higher prices available for lambs finished in the winter and spring.
The Easter lamb market is a high-priced specialty market for young, 40 to 55 pound, live-weight lambs that are finished by Easter. Easter lamb production requires a breed or breed cross that has some finish at this live weight.
Marketing Costs
The distance to a market is influences marketing costs. In addition to the direct cost of transporting lambs to a market, weight loss and stress can lead to lower prices for each lamb. Lambs should be slaughtered the day after shipment to avoid shrinkage and loss of finish. Other marketing costs, of course, include commissions and check-offs.
Live Weight Versus Rail Grade Sales
Slaughter lambs are sold on either a live weight or rail grade basis. The live-weight price is based on the lamb's weight as it crosses the scale. On a live weight sale, the buyer estimates the lamb's eventual value based on dressing percentage, grade and weight, etc., then offers a price per pound live. All processing plants will be equipped to weigh lamb carcasses, but may choose to purchase lambs live as one of their alternatives. The amount an animal actually shrinks or the pencil-shrink taken has a significant effect on the final return when lambs are sold on a live-weight basis.
Shrink is the loss in a lamb's total body weight during shipping. A lamb's shrink is mostly loss of stomach contents or "gut fill" during the first 20 hours off feed. After the first 20 hours, the lamb's body compensates for restricted water and feed intake by drawing moisture and nutrients from carcass tissue. Normally, a buyer should pay more per pound for a 'shrunk' lamb since increased shrinkage reduces live body weight of a lamb. The actual total value of a shrunk lamb has not changed but the animal is simply worth more per pound because its live weight is reduced by the amount of shrink.
Before offering a price, a buyer will estimate the amount a lamb has shrunk either by "eye-balling" the lamb or by knowing how far it has been shipped. The buyer may also apply a "pencil shrink"' to lambs that have not travelled far before being weighed. For example, for lambs from near the plant or lambs weighed before shipping, the buyer may subtract three to four per cent of the scale weight to calculate a "shrunk weight". That calculated "shrunk weight" then becomes the pay weight. Pencil shrink may be as high as six to seven per cent if lambs are to be shipped a long distance and are weighed before shipping,
Rail grade pricing is a price based on the hot weight and grade (assigned by a certified grader) of the slaughtered carcass. The carcass weight usually ranges from 45 to 52 per cent of the live weight, depending on age, finish, and wool length of the lamb. No shrink calculation enters into rail grade pricing since the gut fill is removed before the carcass is weighed.
Producers usually have the choice of selling either live weight or rail grade when lambs are sold directly to a processing plant. It is usually preferable to sell rail grade especially if lambs are of good quality. A buyer, buying rail grade, can offer a better price because he doesn't have to allow a safety margin for lambs that may turn out to be of a poorer grade than they appeared. However, selling live weight to a packer who offers both alternatives is advantageous when the lambs will not be slaughtered with a day after arrival. If the lambs are sold live and slaughter is delayed, payment is based on the weight when the lambs arrive at the plant and any weight loss that occurs through long standing will then be the packer's loss. Most meat processors will give priority to lambs that are bought rail grade.
More information
The following publications are available from Ropin' the Web at http://www.agric.gov.ab.ca/diversify by clicking on "Farm Direct Marketing". They are also available by calling either the Ag-Info Centre at 1-866-882-7677 or the AAFRD Publications Order Office at 1-800-292-5697.
- Farm Direct Marketing for Rural Producers (Agdex 845-6)
- Farm Direct Sales: Know the Regulations (Agdex 845-7)
- The Essentials of Pricing (Agdex 845-1)
- Methods to Price Your Product (Agdex 845-2)
- Direct Marketing Meats...Selling Meat at Alberta Approved Farmers' Market (Agdex 400/845-1)
- Direct Marketing Meats...Selling Lambs at Alberta Approved Farmers' Market (Agdex 430/845-2)
- Direct Marketing Meats...Selling Freezer Lambs (Agdex 430/845-1)
- Direct Marketing Meats...Getting Started (Agdex 845-13)
The "Direct Marketing Meats Resource Guide", a comprehensive guide to consumer-direct meat sales, is available on Ropin' the Web at: http://www1.agric.gov.ab.ca/$department/deptdocs.nsf/all/apa5132 . |
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