SD cattle producers and sales barns working to avoid what happened to state’s sheep industry

Farm Forum

South Dakota’s sheep population peaked in 1943 at 2.4 million head. Now there are only 255,000 sheep in the state, a 89 percent drop, according to the U.S. Department of Agriculture’s South Dakota office of ag statistics.

The reasons for the decrease are several, but key ones have to do with U.S. trade policies that have given other countries more access to America’s meat-loving consumers, says Bryan Hanson.

He’s an owner of Fort Pierre Livestock Auction, one of the biggest sale barns in the country. On Nov. 18, he expects about 9,000 calves to be pushed through his sales ring.

But he thinks those numbers could change down the road, like sheep numbers have declined, Hanson says.

Until 1978, the Fort Pierre Livestock Auction held sheep sales regularly, as well as cattle sales, Hanson said. But there are too few ewes around anymore, he said.

Now, as president off R-CALF USA – Ranchers-Cattlement Action Legal Fund United Stockgrowers of America, he’s working to make sure the same thing doesn’t happen to cattle producers, Hanson said. With members in 46 states, R-CALF promotes the interests of those who have herds of beef cows raising calf crops every year. It’s main concerns lately are what Hanson says is an uneven playing field that gives foreign producers to many advantages, too much access to U.S. grocery store shelves.

U.S. trade policy in the late 1970s and early 1980s allowed mutton and lamb from New Zealand and Australia – where it’s produced much more cheaply than in the United States – more access to the U.S. food market, Hanson said.

The result is that most of the lamb and mutton now bought off U.S. grocery store shelves comes from foreign markets because the domestic producers can’t supply demand, said Steve Clements.

Clements and his family raise sheep northwest of Philip, South Dakota, and have since a few years after his grandfather, Ernest Clements, homesteaded there in 1907.

He’s a director of the South Dakota Sheep Producers Association and represents the long-term trend in wool and lamb production.

“We don’t have a big flock,” he said. “We run a couple hundred ewes.”

When he began with his father 40 years ago, it was different.

“We had around 1,200 ewes at one point,” Clements said.

Several issues have hurt America’s sheep producers, he said. “The biggest thing was the loss of the incentive payments for wool,” he said.

Put into federal policy in the 1950s, the payments came from tariffs imposed on imports of wool, and went largely to producers.

“My dad always said the wool payments pretty much paid what it cost to keep a ewe for a year,” Clements said.

The sale of wool sheared from sheep makes up about 10 to 20 percent of sheep producers’ revenue from their flocks, which comes mostly from the sale of their lambs into the feedlot and meat markets.

But in the early 1990s, the wool incentive payments to producers were nixed and the tariff revenue now does to the general treasury, he said. That change accelerated the decline of the nation’s sheep flocks, Clements said. In South Dakota, the sheep numbers were cut in half from 1993 to this year, when there were 255,000 head counted, according to USDA.

There are about 2,000 sheep producers in the state, and about 200 of them belong to the Sheep Producers Association, Clements said.

But competition from cheaper wool and mutton and lamb from New Zealand, Australia and other countries has taken its toll on the U.S. sheep industry, Clements said.

“We can only produce about 50 percent of what we consume,” Clements said.

His son, Tom, used to raise sheep, but has a full-time job off the ranch and doesn’t have time.

Together, though, they run a herd of 400 Angus cows, often using a same pastures as the sheep.

“Sheep eat more weeds,” he said.

Clements figures it won’t be long before their ranch no longer runs sheep. “Unless one of the grand kids wants to get into them,” he said.

Hanson says he’s worried the same thing could happen to cattle producers in the state. That’s why he helped organize special meetings last week and this week held at livestock sale barns, including the one in Fort Pierre on Nov. 13.

About 160 people showed up and had a lot of questions.

Cattle prices have fallen about 50 percent the past two years, although the fall comes off record high prices in late 2014.

But if Congress and federal agencies don’t improve trade policies to help out U.S. cattle producers, ranching in South Dakota might look very different in a few years, Hanson told the Capital Journal.

There’s too much consolidation among the handful of big corporations who own the packing plants that turn cattle into meat and there’s too much unfair competition from cattle producers in Canada, Mexico, Brazil and other South American countries. Hanson said.

“Those free trade agreements in the 1980s led to imports that devastated the sheep industry,” Hanson said. “It’s important that we raise our concerns that we are trying to keep that same thing from happening to the cattle industry.”