Farm News, IA
11-23-07
Northwest Iowa producers discuss lamb outlook
By RENAE VANDER SCHAAF, Farm News staff writer
Ireton - Northwest Iowa Sheep Producers gathered in Ireton recently for their annual informational feedlot meeting. Topics discussed were lamb finishing basics, 2008 lamb outlook and the new lamb livestock risk protection insurance.
Iowa State University sheep specialist, Dr. Dan Morrical pointed out factors that contribute to cost of gain. The obvious being cost per ton of feed; but feed conversion, genetics, death loss and overall health and waste are factors that must also be considered.
“When building a feed lot, mounds are important to keep lambs out of the mud for food safety reasons,” said Morrical. “The top length should measure a 50 ft. minimum with a gradual side slope of 1 to 6.”
Too small of mounds don’t provide enough space.
It’s important to walk the feedlots twice daily according to Morrical. Death loss can be lessoned if this vigilance is maintained. Morrical advises using a thermometer in a sheep that appears ill. A normal temperature for a sheep is 102 degrees. If a sheep is not running a fever; there is no need for antibiotics.
“Know what lambs weigh,” said Morrical. “Scales are essential as the lambs get closer to fini shing. To produce a higher percentage of yield grade 1“s estimate the lamb“s finished weight by using this formula: 65-percent of average weight of dams on the dam and sire side.” When lambs reach market weight, it is time to sell.
Unable to be at the meeting, Dr. John Lawrence, ISU Extension livestock economist gave his presentation through power point and a recording.
“Research shows that the breeding ewe inventory has just begun a slow rebuilding process,” said Lawrence.
Iowa is second in the nation to Colorado in commercial sheep slaughter. The slaughter lamb prices were strong throughout the summer.
“Historically we see higher prices in the spring and early summer time frame,” said Lawrence. “But recently the trend shows higher prices in the summer and fall. I’m not sure if that trend will continue.”

According to Lawrence, the U.S. imports about as much lamb as it produces.
Lamb supplies are tightening up a bit; that added to a higher percentage of ewe lambs being retained the outlook is favorable for the lamb industry. The high feed costs and other uses for available land in raising sheep will keep the industry“s growth in check.
Of interest to many sheep producers is the new LRP-livestock risk protection insurance recently made available. It is offered by USDA through the RMA Risk
Management Agency and the FCIC Federal Crop Insurance Corporation through private crop insurance companies that choose to participate.
“It’s a price risk management designed to insure against market lamb price declines,” said Dennis DeWitt, ISU Extension livestock field specialist.
“Producers submit a one-time application through a crop insurance agency.”
Specific coverage endorsements (SCE) can be purchased throughout the year with a maximum of 28,000 head per crop year (July 1- June 30).
The application must list all owners have a 10-percent share in the sheep. Only one application is needed yearly; but multiple SCE’s can be purchased for any number of sheep between 1 and 7,000 per SCE.
Premiums are set each week by USDA and are available at www.rma.usda.gov/livestock on Mondays after 10 a.m. until 5 p.m.. The total premium equals coverage price times lamb weight (cwt) times number of head times rate - 13-percent. The 13-percent is the subsidized premium paid to the insurance agent. For example, a producer with 50 head to market in late January
2008 weighing 130 lbs and he wants a 95percent price level. At today’s coverage price, the equation would look like this: $103.57 x $1.30 x 50 x 0.01997 x (1-.13) = $116.96 $2.34/hd total premium payment or $1.80/cwt total premium payment.
Producers have the option of selecting coverage prices ranging from 80 to 95percent of expected ending value on lambs weighing between 50 and 150 pounds. If your business enterprise sells feeder lambs then the 50 pound weight interests you. The producer must also choose the time of coverage. He must decide on a marketing date that will occur within 13 weeks, 26 weeks or 39 weeks. The coverage ends at the end of that time period. For example, if
November 5 is the purchase date then the end date for the 26 week period is
May 5. Coverage and protection ends on that May 5th date.
All lambs must be owned until 30 days before the chosen maturity date.
Producers must also submit a claim form within 60 days of contract end date for indemnity payment. Payment is not automatic.

Dennis DeWitt advises producers to submit an application; then place any number of head of lambs on a SCE (Specific Coverage Endorsement) and work this risk management tool on a small scale to familiarize them with its requirements and uses.
Food and Fiber risk Managers is a Managing General Agency that was formed by the American sheep Industry Association to serve the insurance needs of sheep producers. Its helpful information can be accessed at www.fafrm.com.