Lamb co-op ready for spring launch

Branded, value-added Canadian Lamb Company sets sights on underserved market dominated by imports

Man with RFID equipment at trade show.

Four years in the making, the Canadian Lamb Producers Cooperative (CLPC) is ready to start buying finished lambs this spring.

“Our plan is to start small and ramp up,” said CEO Terry Ackerman, at a recent information session hosted by the Manitoba Sheep Association.

The CLPC, which targets 650 to 1,000 members across nine provinces, plans to exploit new technologies such as RFID tags for traceability and an electronic ultrasound grading system to reward quality.

The ViewTrak probe, developed by a Canadian company, is used to grade 25 million hogs each year, and an algorithm for lamb is currently being developed. Data from each carcass will be available to all co-op members online so they can use it to adjust their production and management systems.

“We’re also probably going to start DNA swabbing them as well,” said Ackerman. “At some point we’re going to want to know the genetic information of your rams so we can tie it back into Genovis.”

The CLPC, the first-ever federally incorporated national co-op, will own and oversee a corporate marketing arm called the Canadian Lamb Company, which is due to launch in March.

Serial entrepreneur

Ackerman, a serial entrepreneur who has worked with many corporate startups including the wildly successful Organic Meadow co-op in Ontario’s Amish country, said that the value of the Canadian sheep industry has been neglected for decades.

Imports of Australian and New Zealand lamb dominate the industry with a 58 per cent market share, and the volume of sales amounts to an extra one million lambs per year.

Sales of imported lamb in the past nine months have soared 20 per cent, roughly the equivalent of 20,000 lambs, and the market is growing steadily, mainly due to the 40,000 immigrants each year who “eat lamb like you eat beef,” he said.

“Every study out there says they want Canadian products. Now we just have to figure out how to make you enough money so you can expand your flock,” said Ackerman.

More from the Manitoba Co-operator website: Lamb prices holding steady for February sale

Canada’s ethnic communities are growing, and in places like the Greater Toronto area, enormous supermarkets are popping up that sell only ethnic foods.

“What do they sell? Lamb and goat. What can’t they get? Lamb and goat,” said Ackerman. He added that in Ontario, lamb burgers sell for $5 for a 3.5-ounce patty, and to get them, customers must put their name on a waiting list.

“Who ever heard of going into a grocery store and putting your name on a list? This isn’t the Soviet Union,” he said.

Waiting lists

Value adding is key to Ackerman’s strategy for generating profits. That’s because packaging lamb products such as kebabs and sausages makes it easier to line up sales to supermarkets as well as major restaurant suppliers such as Sysco that have a product portfolio of over 450,000 products. Of that massive list, he noted, there are only four lamb products.

By operating a wholly contracted-out, cold chain based on frozen convenience products with a 12- to 18-month shelf life, and arranging markets for offal and offcuts, hides and byproducts such as heads, all the value can be captured, he added.

Potential for growth in lamb marketing is everywhere, because products such as lamb pizza simply don’t exist, and even shepherd’s pie is currently being made with beef.

Three collection points have been established in Brandon, Steinbach and Ashern to pick up lambs from Manitoba members, some of the over 100 across Canada who have paid a $500 membership fee and a one-time $30-per-head fee for every lamb shipped per calendar year with a minimum three-year commitment.

Signing up

All breeds of finished lambs will be bought, with freight from the collection points paid by the co-op.

Another 100 producers have signed on to date, and 30 more are on a waiting list. The average flock size of the membership is over 300 ewes, but some have as few as 25, said Ackerman.

Producers will be paid a five-cent premium over the Cookstown, Ont., average market price, a 16 per cent grading quality premium, and the possibility of dividend payouts from the Canadian Lamb Company after three years.

Ownership of brand equity could have significant future value, said Ackerman.

“When I started with Organic Meadow, it was $1,500 to get in. Now it’s $40,000 – and you get a free hat,” he joked.

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