March 28, 2013 Billings, Mont. – In response to requests by sheep producers who recently experienced a 50 percent decline in lamb prices, the 15-member board of directors of R-CALF USA voted last week to form an R-CALF USA Sheep Committee.
R-CALF USA President George Chambers appointed Mud Butte, S.D. rancher and longtime R-CALF USA member Bill Kluck to serve as the committee’s chairman.
“Bill runs both cattle and sheep on his western South Dakota ranch and his ongoing involvement with R-CALF to preserve competition in our cattle markets makes him the ideal chairman for this new committee,” said Chambers.
Chambers said the purpose of the sheep committee is to identify and implement solutions to reverse the exodus of U.S. sheep producers, halt the offshoring of the U.S. sheep industry, and to put an end to price manipulation in the U.S. lamb market.
“Many of our members depend on both cattle and sheep to maintain viable, full-time ranching operations,” said Chambers.
Chambers explained that similar biological characteristics make it possible for cattle and sheep to graze the same rangeland. But, he added, “While sheep help ranchers diversify their operations, the sheep industry is subject to the same antitrust and anticompetitive issues that we face in the cattle industry.”
Kluck said that lamb prices in the latter part of 2012 fell 50 percent below 2011 prices, a drop Kluck said cannot be explained by competitive market fundamentals.
“There aren’t many production or manufacturing businesses in the U.S. that can withstand a 50 percent price decline for their annual production, and our sheep industry isn’t one of them. We need to find a lasting solution to our depressed lamb prices and we need to do it quickly,” Kluck commented.
Kluck asserted that competition is the best of all forms of regulation, but the concentration that antitrust regulators allowed to occur in the lamb slaughtering industry has reduced competition to the point where it no longer functions to prevent price manipulation.
“Our new committee is going to have to be creative to determine what mix of new legislation, new regulations, and increased enforcement will be needed to sustain a viable U.S. sheep industry now that competition has been so seriously eroded,” concluded Kluck.
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R-CALF USA (Ranchers-Cattlemen Action Legal Fund, United Stockgrowers of America) is a national, nonprofit organization dedicated to ensuring the continued profitability and viability of the U.S. cattle industry. For more information, visit www.r-calfusa.com or, call 406-252-2516.
