January 2014
For What It's Worth

Marketing Trends Always Include Exceptions to the Rule

 

Trying to predict trends and prices for small ruminants going to market is not easy; it tends to include surprises and disappointments. Some generalizations include: (1) Summer into early fall tends to bring lowest prices of the year; (2) prices begin to rise slightly in November and December, dropping after Christmas; and (3) prices begin to rise in February and peak in March and April. 2011 and 2012 provided us with some fantastic spring prices and above average prices the remainder of the year. When prime goat prices hit close to $3 per pound in spring of 2012, there was talk about good prices being here to stay. Then 2013 rolled in and prices failed to meet expectations; prime prices in spring rarely rose above $2 per pound, and summer through fall prices hit lows we have not seen in 4 years. By November 2013, prices started to rise, about $1.50 per pound, but nothing to get excited about. I hope some of the concepts and price trends shared in this article will encourage you to develop a marketing plan for 2014.

One thing I have learned about trends, there are always exceptions to the rule. I found the market report shown below of interest; it was taken from the USDA Agricultural Market News in November 2013 and shows some interesting aspects. (Thank you Charlie Meek for sharing.) While there is nothing special about prices for slaughter kids (Selections 1 and 2), prices for slaughter bucks and wethers are significantly higher. While I do not propose everyone haul their goats and sheep to Pennsylvania, here in the Southeast we are not accustomed to seeing higher prices for slaughter bucks, nor do our market reports categorize prices for kids and wethers.

I found these components and pricing from the New Holland report interesting. Based on my observations, I have not seen this trend in the Southeast. In the past, "experts" have told us wethers are discounted at sale barns and older billy goats will not bring good prices. This sales report makes me question generalizations. Then again, preferences for certain types and sizes of goats and sheep vary with some faith-based holidays.

In the past, I have told producers to take advantage of prime market prices by having their sheep and goats to market one to two weeks prior to Christian Easter. Apparently, some people took my advice and did so in 2012 and 2013, and it actually backfired. While reviewing sales reports, I noticed market prices actually dropped one to two weeks before Easter. When asking myself why, I noticed a significant increase in the number of animals going to market during this same time frame; basically, the markets were "flooded" with animals and prices actually dropped. Based on studying the market reports for Easter 2012 and 2013, I began to notice prices actually peaked four weeks prior to Easter. I now suggest having goats and sheep to market four weeks before Christian Easter.

If you watch trends relevant to Orthodox Easter, you will notice prices tend to increase prior to this other Easter: a second surge and another prime market. This occurs only when there are several weeks between Christian and Orthodox Easter such as in 2013. Otherwise, if the two Easters are back to back, there will not be a second opportunity. In 2014, both Easters fall on the same date (April 20). If things go as expected, there should be a strong demand and good prices for goats and sheep about the end of March into early April.

Most types of agriculture production and marketing tend to be risky ventures when it comes to predicting what will occur with weather, harvest yields and price futures; all we can do is keep on trying and hope for the best.

Happy New Year! I hope it is a good year for you and your family, and a profitable year for whatever agricultural enterprise you pursue.

Robert Spencer is an Urban Regional Extension Specialist with the Alabama Cooperative Extension System.