Demand for lamb continues to grow — and the sheep sector continues to struggle to meet it.
In fact, if more fresh Canadian lamb was available, demand would be growing even faster, says the managing director of the North American Lamb Company, the biggest player in the sector.
“With a bit of marketing and new products, we could expand the Canadian consumption quite a bit,” said Gary Alexander. “It’s just a scarce product on our shelves that people don’t even think about buying it. There could be quite a large surge in demand if we could market it as a consumer product.”
The company was formed in 2018 through the merger of Alberta’s SunGold Specialty Meats (and its lamb feedlot near Iron Springs) and Manitoba-based Canada Sheep and Lamb Farms, a subsidiary of a New Zealand lamb producer and processor.
Building the sector in Canada has several challenges. While North American Lamb does year-round lambing at its Manitoba farms, most producers lamb seasonally and many operations are small or part-time enterprises.
That results in a large volume of lambs coming to market in late summer and fall, which causes an excess of supply and a drop in both price and demand, said Ryan Greir, a sheep producer from Strathmore, chair of both the Alberta Lamb Producers and the National Sheep Network.
“There is not just a need for producers to fill that demand, but to fill that demand at different times of the year,” Greir, who raises Rideau-Arcotte sheep, said via email.
The National Sheep Network is the creation of producers in Alberta, Ontario and Quebec, who collectively have 72 per cent of Canada’s ewe flock. After the provincial associations in those three provinces had previously, and separately, left the Canadian Sheep Federation, they discovered they had common philosophies and wanted to develop an organization together, said Greir.
“The three member provinces took the opportunity and the time necessary to address concerns with governance and cost from the previous organization and in October of 2019, created a memorandum of understanding,” said Greir, who became the inaugural chair of the organization at the same time.
To supply the industry, which includes feedlots, processing plants, grocery chains and restaurants, Canadian lamb producers have to work together to produce more lamb during more of the year, he said.
That’s a challenge for existing producers and even more so for new ones.
“They (new entrants) typically produce lamb at the same time as other producers, which adds to the oversupply and is difficult to cash flow with lower prices,” said Greir. “Producing sheep out of season is a much more difficult learning curve and requires a higher skill set.”
Getting financing is also an issue, said Alexander.
“Sheep are very difficult in comparison to cattle,” he said. “It’s not a very big industry. There’s not a lot known about it by financiers and banks. If you want to build a hog barn or a dairy barn, it’s pretty straightforward and you can build your business case. But once you start talking about sheep, there’s no template. It’s not a very big industry, so there are problems with financing.”
Another area of concern is business risk management, said Greir.
Like other ag sectors, lamb producers want to see changes to AgriStability, particularly an increase in the reference margin. Federal Agriculture Minister Marie-Claude Bibeau has promised a review of the program but until changes are made, the lack of an adequate income insurance program is holding the lamb sector back, said Greir.
“The delay and repeated reviews of the AgriStability program with no changes are detrimental to the growth of our industry, and the confidence of our producers to move forward,” he said.
“Producers often do not have the confidence to grow and are caught in a place where they might decide to exit the industry.”
Other areas that the National Sheep Network would like to focus on include traceability, animal health and welfare, processing capacity and market intelligence.
When asked how the sheep industry could become stronger, Greir wrote that there is not “one single silver bullet, and there are a lot of challenges.”
“True national collaboration for our industry has historically been a challenge,” he wrote. “Organizations have come and gone. We feel that the National Sheep Network model is a sustainable and properly governed method that keeps a producer-elected executive to collaborate on national issues.”
In addition to managing the seasonality of the product, Canadian sheep producers have sometimes had inconsistency and quality issues.
“These can be difficult to solve, but as we work towards better educating producers, we feel that these issues will improve,” said Greir.
Alexander also said he is hopeful, too.
“North American Lamb Company is doing OK since it opened,” he said. “We’re in the business of expanding the flock, so we’re in the process of getting up and running and where we want to be. But the processing is doing well.
“Everything appears to be on plan. Building the base flock is key for us and that always takes time.”