Fifty years ago, there were eight million stock sheep in Montana, North and South Dakota and Minnesota. Now, there are fewer than one million.

In an effort to help revive the Midwest’s waning sheep industry, AURI and the Minnesota Department of Agriculture are encouraging lamb producers from three states to form a regional marketing group, such as an LLC, LLP or cooperative. The group would help sheep farmers grow a uniform, consistent product, sell lamb more profitably, and expand their operations.

An ad hoc group of farmers, scientists and agriculture officials from Minnesota and the Dakotas has been meeting for a year to plan the marketing effort. Now the leaders are asking local lamb producers to join in.

“It’s a super idea — working together towards the common goal of increasing lamb production and consumption,” says steering committee member Bill Head, director of sheep research at the West Central Research and Outreach Center in Morris, Minn.

No other sector of the U.S. livestock industry has declined as dramatically as sheep, Head says.

Over the last 50 years, sheep farm receipts fell nearly three-fourths, according to the USDA. In Minnesota last year, sheep and lamb receipts were just $11.5 million — one-tenth of one percent of farm revenues.

What happened to all the sheep? “It’s economics,” Head says.

High costs, soft demand

Rising labor and feed expense, restrictions on predator control and limits on public grazing have all pushed up lamb production costs.

Meanwhile, commodity prices for meat and wool have fallen sharply. New synthetic fibers cut into demand for wool, once the main product of the U.S. sheep industry. “We used to say lamb was a byproduct of the wool industry,” Head says.

Demand for meat has plunged, too. Annual U.S. lamb consumption is down to one pound per person. “We have two or three generations in this country who have never even tried lamb, never been exposed to it.” Unlike the beef, pork and chicken sectors, Head adds, the lamb industry failed to develop fast food fare or new processed products.

U.S. lamb costs more than other meats, too. “That’s the main problem in marketing lamb,” Head says. “Most consumers buy meat according to price.” In addition, American producers face tough price competition from imported lamb. Farmers in Australia and New Zealand raise and ship lamb year-round for less than it costs to grow it here.

A few bright spots

There are some encouraging developments in the lamb industry, says Dennis Timmerman, AURI project director in Marshall.

Domestic lamb gets high marks for flavor and tenderness, he says. And recent immigrants from Africa, Asia and Mexico, where lamb is a staple food, are expected to spark more demand.

New ewe price supports are encouraging farmers to expand their flocks. The recent farm bill includes federal subsidies for wool and premiums for carcass quality and out-of-season marketing. In addition, a new check-off program will provide money for national lamb promotion.

Even in today’s difficult climate, Head says, skillful farmers can make a profit raising sheep. In field trials at the Morris research station, for example, five lamb-ewe pairs per acre of dryland pasture produced net returns of $145 per acre, minus land costs. “That’s better than corn,” Head says.

Why work together?

Most of Minnesota’s 2,400 sheep farmers raise lamb as a hobby or sideline, not as a livelihood. Flocks tend to be small — 40 to 50 ewes — and often have “six or eight different breeds,” Head says. “It’s hard to get a consistent product that way.” Lacking efficiency, small growers struggle to cover their costs, especially if they sell on the spot market.

Producers could gain an advantage by standardizing production and marketing their lamb together, Timmerman says. That is what some southern Minnesota sheep farmers are doing, says Al Doering, a lamb producer from Good Thunder and a researcher at AURI’s coproducts lab in Waseca.

Doering and his father run a 250-ewe flock, raising about 400 market lambs per season. He belongs to a marketing group that sells 20,000 fat lambs a year. Members grow the same breeds and use similar production methods, Doering says. This assures the lambs meet exacting carcass criteria and provide consistent meat yield.

In spite of the soft demand, Minnesota “processors still can’t get enough lambs,” Doering says. It’s one of the few commodities “where we could double our numbers and still find a market.” But to win processing contracts, farmers must be able to guarantee volume and uniform quality — “lamb that will cut out exactly like it did last year and the year before.”

Timmerman says the success of the group Doering is involved in could be duplicated on a multi-state scale: “If growers cooperate, they can tap markets they can’t get into now. Larger numbers would help them get into higher-value markets.”

In addition to marketing clout, a multi-state cooperative would have the muscle to:

  • develop uniform standards for “natural” production,
  • identify specialty markets,
  • assemble performance and genetic data,
  • find new uses for trim,
  • form alliances with other cooperatives, distributors or retailers.

The leaders of the initiative have also discussed other goals, such as cooperative finishing, centralized processing, feeding and nutrition standards, and consumer education campaigns.

Calling all champions

The project’s steering committee has begun exploring organizational structures. This fall, “we’re trying to interest at least three dozen Minnesota producers in the project,” says Terry Dalbec of the Minnesota Department of Agriculture. “We’re looking for project champions” who will lead the effort beyond the discussion stage.

Timmerman says there is strong interest from Dakota farmers. Now, “it’s important that producers in Minnesota come forward.”

For more information about the multi-state cooperative, contact Dennis Timmerman at AURI, (507) 835-8990, or Terry Dalbec at MDA, (651) 215-0368