|For What It's Worth|
|Trends, Assumptions and What May Be Best for Your Situation|
Those of you who monitor livestock sales reports are aware of price variations from location to location, week to week, and even seasonal variations. I have been watching these variations or fluctuations for years and have noticed some general trends that tend to follow specific faith-based holidays (Muslim, Hindu, Buddhist, Orthodox Christian, etc.) and special occasions/seasonal gatherings (coming of age parties, weddings, Thanksgiving, Christmas, New Years, etc.). Based upon these observations, I have been saying for years that prices paid at livestock sales facilities (sale barns) for small ruminants (goats and sheep) tend to start increasing the latter part of October to Christmas, experience a slight decline after Christmas and New Year’s, then start increasing the early part of February into the annual highs around Easter holidays; and then drop to seasonal lows from April to October. While cattle prices tend to do just the opposite, they start rising in spring when pastures begin to green up and remain strong throughout summer, then start dropping come fall as pastures play out. For the sake of time, this article will focus on trends, assumptions and what may be best for your situation as it relates to goat and sheep production.
I took the time to select 2011 archived sales reports of goat and sheep sales from the Columbia Sales Center in Columbia, Tenn. I targeted certain weight ranges and grades, calculated median prices, averaged them on a monthly basis and put them in an electronic spreadsheet for further scrutiny.
The three weight ranges I choose were: 51-65 lbs., 66-80 lbs., and 81-100 lbs. Those are the weight ranges that generally pay the highest per pound. The two grades I targeted were grade 1 and grade 2, as they tend to pay the highest as well. The URL listed at the end of this article will take you to the site I worked from, and then you can choose the sales facility and year of interest. Have fun.
Here are a few trends I noticed: (1) Seasonal price rises and short-term lulls are generally associated with seasonal gatherings and faith-based holidays. The number of animals going to market tends to increase in early winter, hits a lull following Christmas, then starts to increase in February and maxes out in March prior to Easter. (2) One trend that initially bothered me was the spike in number of animals going to market the latter part of June into July. It took me a while to develop an assumption why this occurs every year.
The following are some assumptions I made based on trends: (1) Occasional price spikes during odd times (latter part of summer) may be attributed to floating faith-based holidays. (2) As mentioned earlier, prices start rising October into November and peak in December. This is likely attributed to ethnic and faith-based demand for goat and lamb during special gatherings and holiday season. (3) The drop in prices following New Year’s is due to a diminished occurrence of special gatherings and faith-based holidays. (4) The possible explanation for large number of animals appearing at markets in mid-summer includes three assumptions: (A) Spring lambing and kidding, which means young are likely to need three (+/-) months before being old enough to wean, plus another month or two to reach target weights of 50-80 lbs. (B) Mid-summer drought season is approaching and producers are determined to get excess animals off their pastures. (C) Any combination of the above.
What is best for your situation will vary from farm to farm. If you prefer to target the prime Easter market, then remember Easter varies and buyers must anticipate a demand based on either Christian or Orthodox Easter, so March is generally an ideal time to get your animals to market. Some producers will choose to establish the breeding season of their animals to include species-specific grow-out rates that will have their animals ready for seasonal markets, while others may choose to have animals available on a year-round basis while others may have seasonal preferences for kidding or lambing in spring which makes it easier to avoid the extreme cold temperatures of winter and extreme heat of summer; extreme environmental conditions do have their drawbacks.
In summary here are some thoughts: (1) Buyers who frequent these sale barns are likely to make their purchases several weeks in advance of specific time frames for special gatherings and faith-based holidays. (2) As marketing manager you should be strategically planning your livestock breeding program based upon your intent to target specific holidays, year-round markets or both. (3) Mother Nature can mess-up the best made plans. So anticipate the unexpected and plan options. (4) Re-evaluate your plans from time-to-time and make adjustments accordingly. (5) Consider this, if the majority choose to target seasonal markets (Christmas and Easter), that could limit year-round availability of animals; therefore, driving up prices in off-season. (6) By the same token, if everyone floods the market with animals during a certain season, it is likely to suppress prices.
Simple economics, right Max? Thanks JC for the additional homework. :-)
Robert Spencer is a contributing writer from Florence.