The law of supply and demand may usually prevail, but it’s having a bit of trouble working in the Canadian sheep industry.
“The No. 1 challenge we face is a shortage of supply,” said Miles Kliner, general manager of Sungold Specialty Meats in Innisfail. “That has been going on for 15 to 16 years. We have fewer sheep market lamb inventory in this country now than we did in 2001 and yet we are in a demand market, which is continuing to grow.”
Lamb is the only red meat protein which has grown in consumption in Canada over the last 10 to 12 years.
One reason why is the changing nature of Canada’s ethnic population. Millennials and the population at large are also looking to try new types of proteins that are healthy, and more environmentally sustainable.
“As Canada becomes more diverse, ethnic immigrants are for sure driving demand, and I think there are more foodies, more people who are becoming aware of what is produced locally,” said Darlene Stein, chair of the Alberta Lamb Producers (ALP). “I think there is a bigger push from that sector as well.”
Stein, who raises a commercial flock with her husband near Barrhead, said Canada is not able to meet even 50 per cent of its market demand. The other 50 per cent is currently being filled by New Zealand lamb.
“In order for us to expand, we have to be able to compete. It’s great that consumers are becoming more aware of ‘buy local’ but a significant portion of the population is looking at price,” said Stein, who lambs out about 500 to 600 grass-based ewes every year.
The scale problem
Canada needs to compete with New Zealand, but unfortunately, Canadians can’t graze their sheep year round like the New Zealanders can.
“There are a lot of expenses that they just don’t incur,” said Stein, who has been in the sheep industry for 10 years.
One of the challenges for Albertan and Canadian producers, is being able to raise enough sheep so farmers can earn their livelihood from their flocks.
Sheep require far more hands-on work than cattle.
“A lot of cattle producers will grow their herd and then get a second job. When you’ve got 300 sheep, it’s very difficult to go get a second job, but that’s still not enough sheep to live on,” said Stein, who used to be in the cattle industry.
Most ALP members are small producers. Stein estimates 70 per cent are under 100 head, and probably at least 50 per cent are under 50 head.
The industry continues to attract new entrants, both in Alberta and Canada. As part of its goal to grow the industry, ALP has joined with sheep organizations in Ontario and Quebec to make its voice more powerful. There is also a sheep representative sitting on the committee for business risk management for the Canadian Federation of Agriculture.
But there’s lots of incentive to get into the sheep industry.
“The demand curve for lamb looks very good,” Sungold’s Kliner said. “If you read or follow or listen to so-called experts who are economists and study these things in detail, the suggestion by all reports is that lamb will continue to grow in per capita consumption in this country over the next five to 15 years. You couldn’t really ask for a better situation,” he said.
While lamb is exported to other nations, most lamb raised in Alberta is still consumed domestically.
Most sheep that enter Kliner’s plant are raised by producers he considers hobbyists who don’t have the scale to support themselves.
Stein agrees that there are a lot of new entrants joining the industry, but they are mostly small scale, and may be new to livestock production or farming in general. Many people join, but can be discouraged because sheep death losses can be high, due to predation or animal husbandry errors.
Kliner is looking to develop business relationships with producers who want to make the sheep industry their primary business.
“As time goes on, we’ve already made some significant inroads. Next year will be much different for us than this year from a supply standpoint,” he said.
Stein doesn’t know if Canada will ever have all-Canadian lamb, just because of all of the challenges of the sheep industry.
“It would be nice to see a time where we are filling 80 per cent of our market,” she said.