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Producing lambs for the ethnic market

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Presentation at 2016 Iowa Sheep & Wool Festival.

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Producing lambs for the ethnic market

  1. 1. Producing lambs for the ethnic market SUSAN SCHOENIAN Sheep & Goat Specialist University of Maryland Extension sschoen@umd.edu
  2. 2. Lamb Demand • Per capita consumption of lamb is very low, less than 1 lb. per person; however, consumption is much higher among people of certain ethnic and religious groups. • Population trends and immigration patterns favor an increase in the demand for lamb, mutton, (and goat). • Imports comprise anywhere from ⅓ to ½ of the domestic lamb market; however, ethnic consumers tend to prefer a fresh product. • Lamb is the preferred meat for the three major religions: Christian, Muslim, and Jewish; demand usually increases in advance of major holidays.
  3. 3. Comparison of lamb markets Traditional (commodity) • Higher volume • Little variability in type of lamb sold: mostly large lambs finished in feedlots. • Price volatility; market sets prices. • Long-term decline in production. • Continuing loss of infrastructure. • Must change to survive (Hale Report). Non-traditional, including ethnic • Lower volume • Demand outstrips supply • Markets have room to grow due to favorable demographics. • Less price sensitivity and volatility because producers often negotiate prices. • More competitive with imported product. • More consumer feedback • Variable demand for type of lamb. • Can meet demand with different breeds and types and different production systems and feeding programs.
  4. 4. What is an ethnic market? • An ethnic market is a group of consumers who share a common cultural background: race, color, national origin, religion, or language. • There is no single ethnic market for lamb and mutton. • The ethnic market is composed of many different market segments, each with consumers having potentially different buying preferences.
  5. 5. Two largest demand sectors for lamb MUSLIM HISPANIC Source: http://www.allied-media.com/AM
  6. 6. Two largest demand sectors for lamb Hispanic • Hispanics are the fastest growing minority group. • The Latin wave is bigger than the baby boomer generation. • Hispanic buying power has increased 76% since 1990. • Hispanic families are larger. • Hispanics are more likely to cook at home and from scratch. • Hispanics spend more money on food than the average American. Muslim • There are as many as 8 million Muslims in U.S. • The annual growth rate (6%) is larger than U.S. population growth (<1%). • It is the same size community as Hispanics were 25 years ago. • The average Muslim is younger, well-educated, and affluent.
  7. 7. Population trends and immigration patterns favor an increase in the demand for lamb. U.S. Population Demographics US Iowa Population (2012 estimate) 321,418,820 3,123,899 White 77.4 92.1 Black, African-American 13.2 3.4 Native American (Indian, Eskimo) 1.2 0.5 Asian 5.4 2.2 Hispanic or Latino 17.4 5.6 Foreign-born 13.1 4.7 Language other than English spoken in home 20.9 7.4 Per capita income $28,555 $27,621 Median household income $53,482 $52,716 Below poverty level 14.3%Source: http://quickfacts.census.gov/qfd/states/00000.html
  8. 8. What are the population demographics in Iowa? Population Demographics Sioux City Iowa Population (2012 estimate) 82,517 3,123,899 White 80.6 92.1 Black, African-American 2.9 3.4 Native American (Indian, Eskimo) 2.6 0.5 Asian 2.7 2.2 Hispanic or Latino 16.4 5.6 Foreign-born 10.7 4.7 Language other than English spoken in home 17.9 7.4 Per capita income $22,395 $27,621 Median household income $43,629 $52,716 Below poverty level 14.3%Source: http://quickfacts.census.gov/qfd/states/00000.html
  9. 9. Sheep meat is favored by the three major religions: Christian, Jewish, and Muslim. Religious affiliation Percentage among all U.S. adults Christian Protestant Catholic Mormon Jehovah’s Witness Orthodox 2007 51.3 23.9 1.7 0.7 0.6 2014 46.5 20.8 1.6 0.8 0.5 2007 78.4 2014 70.6 Other Jewish Muslim Buddhist Hindu Other 1.7 0.4 0.7 0.4 1.2 1.9 0.9 0.7 0.7 1.5 4.7 5.9 Unaffiliated 16.1 22.8 Don’t know/refused to answer 0.8 0.6Source: http://religions.pewforum.org/reports (2007-2014)
  10. 10. Ethnic holiday calendar http://www.interfaithcalendar.org/
  11. 11. Determining population demographics • United States Census Bureau http://www.census.gov • Pew Research Center http://www.pewresearch.org • Faith in Communities Today http://faithcommunitiestoday.org • Allied Media Corporation http://www.allied-media.com • Other web sites via internet searches
  12. 12. Identifying potential ethnic consumers • Determine population demographics. • Identify Mosques and Orthodox churches in your area. • Identify ethnic or foreign stores and businesses near to your farm. • Identify universities and colleges with ethnic or foreign faculty and students. • Don’t overlook doctors and other professionals as potential consumers of lamb and mutton. • Identify farms and other businesses that employ seasonal, foreign, or immigrant labor.
  13. 13. Targeting ethnic consumers • Visit mosques, churches, and community centers. • Contact foreign student associations. • Make contacts at sale barns and slaughterhouses. • Advertise in ethnic media. • Put notices up at ethnic stores and businesses. • List your farm on available web sites. • Establish your own web site.
  14. 14. Marketing to ethnic consumers • Determine the type of lamb your customers want, when they want it, and how the want it. • Evaluate your marketing options. • Develop a marketing and production plan that maximizes profit.
  15. 15. Slaughter options for sheep and lambs • There are four levels of inspection in the U.S. 1) Federal (USDA) inspection 2) State-inspection 3) Custom-exempt 4) Personal exemption (i.e. on-farm slaughter) It may be necessary to facilitate slaughter for ethnic consumers: know the options.
  16. 16. (USDA) Federally-inspected slaughter • Highest level of inspection. • No restrictions on sale of properly-labeled meat. • Extensive sanitary requirements for facility; HACCP plans required. • Pre and post-inspection of animal. • Access to federally-inspected slaughter may be limited in some locations. http://www.fsis.usda.gov Topics | Inspection | FSIS-Inspected Establishments: Meat and Poultry Inspection Directory
  17. 17. State-inspected slaughter • Federal-state partnership: state inspection must be “at-least equal” to federal inspection. Most state regulations mirror federal regulations. • Sale of meat is usually limited to sales within state of slaughter. • Only 27 states have state meat inspection programs. • In Iowa, the Meat & Poultry Inspection Bureau of the Iowa Department of Agriculture and Land Stewardship holds cooperative agreements with USDA/FSIS to provide meat and poultry inspection. • Producers in states without state meat inspection are subject to federal regulations and any additional regulations imposed by their state or county. http://www.fsis.usda.gov Topics | Inspection | State Inspection and Cooperative Agreements
  18. 18. Custom-exempt slaughter • Exempt from continuous inspection. • There are sanitary requirements for slaughter facility and inspection requirements, but no pre or post- mortem inspection of animals. • Meat must be stamped “not for resale” and returned to owner for consumption by owner, family, non- paying guests, and employees. • Be sure to sell a live animal when utilizing custom-exempt slaughter.
  19. 19. Personal exemption • Allows a farmer to slaughter an animal of his/her own raising. • No inspection of facility or animal. • Consumption of meat limited to farmer, family, non-paying guests, and employees.
  20. 20. Does USDA’s personal exemption allow the buyer of a live animal to slaughter the animal for his own use? • Many states consider the on-farm slaughter of an animal to be illegal except by the person who raised it (Illinois has added an ownership requirement of at least 30 days). • In particular, many state regulators are opposed to allowing a buyer to slaughter an animal on the farm where it was purchased. • In reality, USDA and most states fail to address the legal rights of the buyer to slaughter his own animal; thus, leaving it open to interpretation.
  21. 21. Personal exemption comparison New York • The owner of the animal is considered to be the owner when he/she purchases it. • Seller must sell a live animal and not assist in the slaughter in any way. Vermont • Recently passed a law that will allow the on-farm slaughter of up to 25 sheep (or 3,500 lbs. of an live animals). • Slaughter site must be sanitary and designed to prevent water pollution. North Carolina • All slaughter must take place in an approved facility regulated by the North Carolina Department of Agriculture and Consumer Services. • Only exemption is for the person who raised the animal.
  22. 22. Be sure to know the laws in your own state and how they are interpreted and enforced. Potential sources of information • State Department of Agriculture • State Department of Health • County Health Department • USDA Food Safety & Inspection Service (FSIS) www.fsis.usda.org • State Extension Services • Niche Meat Processor Assistance Network @ eXtension.org
  23. 23. About religious slaughter • 1) Halal (Muslim) 2) Kosher (Jewish) • Religious or ritual slaughter is exempt from U.S. Humane Slaughter Laws. – Primary difference is that animals are not stunned prior to slaughter – However, animals should be properly restrained for slaughter. – It may also be necessary for a Muslim or Rabbi to perform the slaughter. • In some locales, there may be limited access to plants that perform religious (esp. certified) slaughter. • A Muslim may be able to perform Halal slaughter in some custom- exempt plants.
  24. 24. Humane (Halal) On-Farm Slaughter Poster available from www.sheepgoatmarketing.info: Education | Resources
  25. 25. • Growth market. • Higher demand. • Higher prices/profit possible. • Ability to negotiate prices. • Less price volatility. • Less price sensitivity. • May get feedback from consumers. • May be able to develop market(s) for less desirable animals (e.g. culls). • Can sometimes “hold” lambs without losing market acceptance. Marketing lamb/mutton to ethnic consumers PROS CONS • Need to learn customs of different ethnic groups. • Ethnic marketing opportunities will be limited by population demographics in region (ethnic groups tend to live in or near large urban centers). • Language and cultural differences • Dates of religious observances change each year. • Demand is concentrated a few times during the year. • Producers often flood the markets prior to religious observances, resulting in lower prices. • Direct marketing can be time-consuming. • May need to change the way you raise sheep (including breeds).
  26. 26. You may already be marketing your lambs to non-traditional (ethnic) markets. Growing US Ethnic Market for Lamb ”San Angelo is now a 100 percent ethnic- driven market and we’re the largest sheep/goat auction in the nation.” Benny Cox, Sales Manager at Producer Livestock Auction in Texas
  27. 27. At what weight should you sell your lambs? WT $ 100 $ 125 $ 150 $ 175 $ 200 $ 225 $ 250 $ 275 $ 300 50 $ 88 $ 100 $ 113 $ 125 $ 138 $ 150 75 $ 94 $ 113 $ 131 $ 150 $ 169 $ 188 $ 206 $ 225 100 $ 100 $ 125 $ 150 $ 175 $ 200 $ 225 $ 250 $ 275 125 $ 125 $ 156 $ 188 $ 219 $ 250 $ 281 Lamb Feed: Feed Cost Cost Lambs Feed Total Market Income Weight Grain $/lb $/lamb $/ewe Per ewe $/ewe Feed $ $/lb $/lamb Profit 40 1.0 $0.15 $ 140 2.2 $ 64 $ 64 $ 3.00 $ 120 $ 56 50 2.5 $0.15 $4 $ 140 2.2 $ 64 $ 67 $ 2.80 $ 140 $ 73 60 3.5 $0.15 $9 $ 140 2.2 $ 64 $ 73 $ 2.50 $ 150 $ 77 70 3.7 $0.15 $14 $ 140 2.2 $ 64 $ 78 $ 2.20 $ 154 $ 76 80 3.8 $0.15 $20 $ 140 2.2 $ 64 $ 84 $ 1.80 $ 144 $ 60 90 4.0 $0.15 $26 $ 140 2.2 $ 64 $ 90 $ 1.60 $ 144 $ 54 100 4.3 $0.15 $33 $ 140 2.2 $ 64 $ 96 $ 1.60 $ 160 $ 64 110 4.8 $0.15 $40 $ 140 2.2 $ 64 $ 103 $ 1.60 $ 176 $ 73 120 5.8 $0.15 $49 $ 140 2.2 $ 64 $ 112 $ 1.60 $ 192 $ 80 130 7.0 $0.15 $59 $ 140 2.2 $ 64 $ 123 $ 1.60 $ 208 $ 85 140 8.5 $0.15 $72 $ 140 2.2 $ 64 $ 135 $ 1.60 $ 224 $ 89 Source: Richard Ehrhardt, MSU
  28. 28. At what weight should you sell your lambs? $50 $55 $60 $65 $70 $75 $80 $85 $90 40 50 60 70 80 90 100 110 120 130 140 Profit based on selling weight of lambs
  29. 29. Thank you for your attention. Any questions? SUSAN SCHOENIAN Sheep & Goat Specialist University of Maryland Extension sschoen@umd.edu - www.sheepandgoat.com

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