Lamb prices plummet one year after record highs

Wholesale lamb prices are at an all-time low. A pound of lamb chops costs about $16 and ground lamb costs about $10; but ranchers are being paid less than 90 cents a pound, "far below what they need to break even," reports Emily Guerin of High Country News. Ranchers say slaughterhouses are fixing prices because lamb was selling at record high prices of more than $2 a pound last year. Senators from Montana, the Dakotas and Wyoming have asked the Grain, Inspection and Packers and Stockyards Administration to investigate. (HCN photo)

But Guerin writes there are a lot of other theories for the sudden price drop. Increasing amounts of African and Middle Eastern immigrants who favor lamb meat caused prices to soar for almost a decade. Last year's record-high prices have likely created this year's bust because prices eventually got too expensive for consumers, Guerin writes. Consolidation of meatpacking companies had a big impact, too. There are only a few major lamb packers in the U.S., and one company's decision to reduce buying can have a major impact on prices. Greater imports of cheaper lamb from New Zealand and Australia, which now account for almost half the lamb on the U.S. market, also hit ranchers hard.

The drought this year, though, "really crippled the sheep industry," Guerin writes. Nearly 60 percent of the country was in drought by mid-July, and since sheep ranchers rely heavily on pasture because lambs are rarely "finished" in feedlots, drought hit the industry hard. Feed prices rose at the same time, forcing many sheep ranchers to sell off flocks early because they couldn't afford to feed them. (Read more)