An agricultural ewe-dunnit: Alberta lamb industry can't explain as prices reach record highs
Producers are thrilled, restaurateurs feeling the bite
With the price of lamb springing to record levels in Alberta, people who enjoy the occasional lamb dinner may start feeling a little fleeced at the cost.
Before 2020, the five-year average price-per-pound of heavy lambs never rose above $2.50, but industry numbers show that prices crossed that threshold late last year and haven't turned back.
For perspective, in November 2019, the price dipped below $1.50 per pound. In February 2021, it reached almost $3.50 per pound.
However, figuring out what's behind that increase is a challenge.
"We've certainly worked with other provincial commissions, producers, packers, feedlots, even looking at our import statistics to try to understand it," said Ryan Greir, chair of Alberta Lamb Producers.
"I think the bottom line is we don't see a single contributing factor."
One factor could be that producers, in anticipation of price increases, are holding back on the sale of breeding ewe lambs for flock growth in order to generate more future revenue, Greir said.
Greir also believes there's increased demand from consumers but said that's difficult to quantify. Regardless, with COVID-19 reducing operations at restaurants and shutting down cruise lines, it is encouraging to see that demand is still strong, he said.
For Ray Nolan, who owns and operates Lambtastic Farms in Vulcan, Alta., there are pros and cons to the increasing price.
Nolan will fetch more money for the lambs he raises and sells to hotels and restaurants. "It's really something great for producers that we can finally get a good price for all the work that we put into it," he said.
It also means he'll pay more for breeding ewes.
"When we got into this in 2012, we could buy a lamb for $100. Fast-forward 2021, it's $300," he explained.
He can't explain what caused the price jump but he does believe more diners are choosing lamb.
"I don't really know what's caused it, but from the business that we're in, we kind of know that the demand for lamb has risen quite a lot and there's a lot more people eating lamb," he said.
Restaurateurs, meanwhile, are struggling with the rising prices.
Lamb is among the most popular dishes served by The Bedouins, an Edmonton restaurant serving North African-inspired food, but owner Emad Elgaddafi says his cost has nearly doubled in the past six months.
"It's been crazy," he said. "The cost was about $220 for a whole lamb, now it's at the $400 range."
Elgaddafi isn't sure his customers would be willing to swallow an equivalent price increase.
"I've been talking to the chef lately. Should we just make it only on the weekend, should we lower the portion size, what are we supposed to do?" said Elgaddafi.
"I was thinking maybe take it off the menu. I can't raise the price because people can't afford it."
Elgaddafi hasn't taken any action yet but said he can't continue taking a loss to keep lamb on the menu.
And with no clear explanation for the price increase, it's impossible to guess when — or if — the market will return to where it was a year ago.
Greir is perplexed that the rise in prices started in the fall, a time when there is a lot of lambs coming off pasture that would normally drive the price down.
"The price drop that we had anticipated never happened so that's where the mystery comes in," he said.
That also makes it hard to predict future prices.
"It's a large anomaly off of what we normally see, especially for this length of time," Greir said. "In terms of moving forward, we're not sure how the market will react."