WHY SHEEP & GOAT PRICES ARE EXPLODING

This post explains why goat and sheep prices are skyrocketing in 2022!

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The small ruminant market has exploded in the United States. Since 2017 the market value of sheep is up 77% and goats 60%. As of February 22, 2022 premium goat kids are bringing $4.22 per pound on the hoof, while premium lambs are bringing $3.73 per pound.

With those prices side by side, the question might arise: are goats more profitable than sheep? In this post I will evaluate market prices from the past 5 years (with graphs), I will discuss management factors that may or may not make goats a more difficult animal for you to raise, and finally I will address the important question: is this massive uptick in small-ruminant pricing a bubble waiting to burst?

While I raise exclusively sheep at this moment, I called in my friend Karl Ebel who has 20 years of experience raising meat-goats. If you click on the link below I will send you a 1 hour podcast we did together discussing the ins-and-outs of sheep vs. goats!

First off, let’s take a look at sheep pricing from October 2017 to present. The chart below shows the rise in sheep prices (red) and goat prices (blue) over the past 5 years.

I am using USDA market reports from San Angelo, Texas, the largest sheep and goat sale in the nation. The prices I am getting ready to reference are price per pound for a living animal. The category I had pulled data from is for average-quality kids and lambs. Slaughter Lambs choice 1-2 and slaughter kids Selection 1-2.

I advocate for private sale over sale barns. However, unless you are buying purebred, registered, or highly specialized breeding stock, conventional market prices will dictate the prices on your farm.

In October 2017 an average quality lamb 70lb was bringing $1.66 per pound. A goat kid in the same weight and quality category was bringing $2.26 per pound. This means a 70 pound lamb or kid would sell for $116.20 and $158.20 respectively. On February 22, 2022 that same lamb and kid sold for $206.50 (2.95/lb) and $253.40 ($3.62/lb), an increase of 77% for lambs and 60% for kids. To reinstate, these are average-quality lambs and kids; not premium, choice, or purebred stock.

While goat and sheep pricing is steadily coming to a convergence, goat-kids still bring 22% more at market. Does this mean that goats are more profitable than sheep?

The answer depends on your climate and resource base. Sheep and goats are pretty similar when it comes to infrastructural needs and handling requirements, but there are a few differences that need to be addressed.

Goats are less resistant to parasites than sheep, metabolizing conventional dewormers at a rate 2 times faster than sheep. The Clemson University dewormer chart for sheep and goats cites a dewormer dosage level for goats that is almost double that of sheep. Goats prefer a diet of 80% brush and 20% pasture. Sheep prefer 50% brush and 50% pasture.

Here is a table that cites further differences between sheep and goats:

Sheep:	Goats:
$2.95/lb USDA Market Value (Feb 2022)	$3.62/lb USDA Market Value (Feb 2022)
Low to Moderate Parasite Resistance.	Very Low Parasite Resistance.
Diet of 50/50 grass to brush.	Diet of 80/20 grass to brush.
Too much copper is poisonous.	Require significant amounts of copper to survive.
Faster growth rate. (eg: 70 lbs by 4 mos)	Slower growth rate. (eg: 70 lbs by 7 mos)
Containment: difficult.	Containment: very difficult.

The bottom line of this comparison is that if you are in a dry (28″ of rain or less), brushy climate goats will indeed be more profitable than sheep. However, if you live in the grassy, high rainfall area the 22% increase that goats bring will likely be eaten up by increased labor in parasite management.

If you want an even more in-depth species comparison check out Rolling O Farms channel. He raises sheep and goats side by side. Just be sure to tell him I sent you!

Will sheep and goat prices stay strong?

Now comes the question: is the small ruminant market going to hold strong? While we may hit a small dip in pricing I believe the market for sheep and goats will remain strong. Here are 5 reasons why:

First: Sheep and goats are among the only unregulated (whether social or political) agricultural commodities in the USA. Beef prices are manipulated by packers and politics. Grain prices are suppressed by subsidies. Sheep and goats being purchased in today’s market head straight to the plate via private processing or demand from ethnic communities.

Second: I believe the rise in sheep and goat prices directly reflects inflation. As the dollar weakens, sheep and goats will become more valuable. Because sheep and goats are largely unreglutated and unsubsidized (feed-stuffs excepted), their value reflects inflation in a way that regulated and subsidized commodities do not. I believe that the price the US is seeing with sheep and goats is directly reflective of a weakening dollar. When the dollar weakens, things of true value cost more (unless regulations and subsidies are in place to suppress the true price).

Third: with much of the USA drying up these days, sheep and goats are an ideal drought plan. They thrive in dry, arid climates consume less water, and have a feed conversion that is double that of larger cattle. This means that when rain stops falling, sheep and goats can float a ranching operation while their large cattle counterpart will have to be destocked.

Fourth is a point stated by Karl Ebel: ethnic demand for sheep and goats is growing in the USA. Sheep and goat meat are a staples in various ethnic communities like beef is for the American. As the ethnic demographic continue to enlarge in the USA, so will demand for sheep and goats.

Fifth: small ruminants are hard to raise. Some may tell you otherwise, but the consistent feedback from veteran ranchers is that sheep and goats require a much higher level of management than large cattle. For this reason, competition is scarce and established producers (or people willing to commit to the highs and lows of launching a sheep and goat operation) have a major advantage.

Supply in demand:

Supply in demand is also a huge factor in the explosive prices sheep and goats are bringing today. This chart from SheepUSA shows the decline in sheep production in the USA. Much of this decline was spurred by the discontinuation of wool subsidies in 1995. Without these subsidies, income from wool sheep was drastically cut. The expense of shearing and the near-worthless nature of wool (in conventional markets) make wool sheep more of a liability than an asset for most operations.

However, as ranches destocked their wooly backs, hair sheep began to take the stage. With exceptional carcass yields and no shearing expense, hair sheep became a profitable replacement to their wooly counterparts. (http://www.sheep101.info/201/hairsheep.html) In fact, in 2019 a major shift was cited when for the first time over 50% of sheep receipts at market were consistently hair-breed sheep.

With so many factors driving the price of small ruminants upward I’d say it’s a good day to be a shepherd!