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User’s Guide to USDA’s Lamb Carcass Cutout

December 2021

The lamb carcass cutout value represents the estimated value of a lamb carcass based on prices paid for individual lamb 

items from the carcass. The cutout value is published at 3 p.m. Central each weekday on the USDA Estimated National 

Lamb Carcass Cutout Report under report number LM_XL502. The individual lamb item prices utilized in the cutout 

calculation are derived from sales published each weekday at 3 p.m. Central on the National 5-Day Rolling Average 

Boxed Lamb Cuts - Negotiated Sales Report under report number LM_XL500. Historical data for both reports is available on the USDA DataMart website.

The lamb item sale prices used in calculating the 

lamb cutout meet the following criteria:

• All lamb item transactions are original sales by firms covered under Livestock Mandatory Reporting (LMR) to first time buyers. 

The threshold for LMR is firms slaughtering (or processing the equivalent of) an average of 35,000 head of lambs per year.

• Sales are negotiated, with the product delivering within 0-21 calendar days to the domestic market.

• Lamb items are referenced according to the Institutional Meat Purchase Specifications (IMPS) when possible and are limited to 

the USDA Prime and Choice grades.

• Sale prices of all lamb items are quoted on an F.O.B. plant basis (delivered price minus freight cost).

• Prices of lamb items are a 5-day rolling weighted average. This ensures an adequate market test for item prices used as input 

data in the cutout calculation.

The cutout report is used by the various segments of the lamb industry as a price barometer for trade negotiations with other 

parties. Companies also use the cutout report as a standard by which to gauge their company or even their personal performance. Finally, some segments of the industry may use the report as an impartial starting point on which to base formulations 

and contracts. As packers and producers continually strive to improve their business, many look to the lamb cutout to provide a 

pricing basis. 

What the Cutout Represents

The lamb cutout represents the estimated value of a lamb carcass for a given day based on prices being paid for individual 

lamb items. As mentioned, the values in the lamb cutout are expressed in dollars per hundredweight (cwt). For example, a lamb 

cutout value of $300.00 means a 100-pound carcass is worth $300.00 total dollars. However, a 70-pound lamb carcass is worth 

70% of that, or $210.00 total dollars ($300 x 70% = $210).

A single carcass cutout value exists for all carcass weight categories, as the many pounds of individual lamb items cannot be 

directly sourced back to each separate carcass with its corresponding weight. This reality of modern lamb fabrication is why AMS 

publishes a single carcass value representing all weights, while the yield percentages are based on a 65-pound carcass.
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The cutout report lists a Gross Cutout Value, which represents the cutout value including average expenses for processing and 

packaging. From the gross value, AMS deducts $62.00 per cwt for processing and packaging to arrive at a Net Carcass Value. The 

$62.00 is an average cost paid by firms covered under LMR, with individual company costs held in strict confidence by AMS. The 

lamb carcass cutout does not include revenue from pelts or offal products.

Lamb Cutout Calculation

The lamb cutout calculation begins with individual item prices from the LM_XL500 report. These individual items are listed on 

the left side of the LM_XL502 report shown in Figure 1 below as the report appears in publication. The first numerical column 

shows the lamb item’s F.O.B. cwt price, followed by the daily change. Next is the item’s fabrication yield to the carcass. This yield 

percentage is also an average of LMR firms with individual data kept in strict confidence. The final column is the weight of each 

individual lamb item in pounds. 

Figure 1

Imps Items FOB Price 

Cwt Change %Carcass LBS

Foresaddle

204 Rack, 8-Rib Medium $853.26 $-0.98 5.65% 3.90

204c Rack, Roast-Ready, Fr $1,740.33 $13.08 3.07% 2.12

209 Breast ** $323.33 $-1.14 8.45% 5.83

207 Shoulders, Sq-Cut $359.72 $-0.01 23.10% 15.94

210 Foreshank $449.16 $0.53 3.25% 2.24

Neck ** $233.41 $0.46 2.17% 1.50

Fat And Bone $10.00 $0.00 3.50% 2.42

296 Ground Lamb $613.96 $1.21 1.95% 1.35

Shrink 0.35% 0.24

Hindsaddle

232 Loins, Trimmed 4x4 $704.40 $2.08 5.56% 3.84

232 Loins, Trimmed 1x1 $848.49 $3.63 3.81% 2.63

232e Flank, Untrimmed ** $215.74 $-3.81 3.22% 2.22

233a Leg, Trotter Off $438.01 $3.00 15.81% 10.91

234 Leg, Boneless, Tied $626.23 $-2.70 10.24% 7.07

Fat And Bone $10.00 $0.00 7.56% 5.22

296 Ground Lamb $613.96 $1.21 1.96% 1.35

Shrink 0.35% 0.24

Gross Carcass Value: $468.64 $0.65 100.00% 69.00

Foresaddle Value $473.95 $0.58 51.49% 35.53

Hindsaddle Value $463.01 $0.73 48.51% 33.47

Carcass Value Less Process/Packaging Per Cwt Cost of $62.00

Net Carcass Value $406.64 $0.65

* Fat and Bone an industry survey value for LM_XL502 calculation * Based on Actual Federally Inspected Slaughter Carcass 

Weight of 69.00 lbs. for W/E 01/30/2021, 6.00 lbs heavier than last week. ** Includes Fresh and Frozen Products
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The carcass yield of certain individual items are adjusted to accommodate the addition of other styles of the same item or 

cut. For example, an IMPS 204 8-Rib Medium Rack has a yield to carcass of 11.30%, while the IMPS 204C Frenched Rack has 

a yield to carcass of 6.13%. The 204 Rack and 204C Rack are exclusionary, in that only one or the other can be made from 

a carcass. They also sell in roughly equal quantities. Therefore, the yield of the 204 and 204C racks are both reduced in half 

to 5.65% and 3.07% respectively, allowing both items in the carcass cutout calculation. This same methodology is used in 

pairing the IMPS 232 4x4 and 1x1 loins, as well as the IMPS 233A trotter off leg and IMPS 234 boneless leg.

The fat and bone price represent a rendered value for these products, which is obtained through an industry survey. Shrink 

constitutes a loss in moisture or weight, and therefore has no value; however, it is still included to ensure 100% of the carcass is accounted for. Fat and bone, ground lamb and shrink are listed twice to determine values for both the foresaddle and 

hindsaddle. Figure 2 demonstrates the cutout value, foresaddle and hindsaddle calculations more in-depth.

Figure 2

Imps Items FOB Price 

Cwt X Percent Of Carcass = Item Revenue Cwt

Fore/Hind 

Calculation

204 Rack, 8-Rib Medium $853.26 X 5.65% = $48.21 $48.21

204c Rack, Roast-Ready, Fr $1,740.33 X 3.07% = $53.43 $53.43

209 Breast ** $323.33 X 8.45% = $27.32 $27.32

207 Shoulders, Sq-Cut $359.72 X 23.10% = $83.10 $83.10

210 Foreshank $449.16 X 3.25% = $14.60 $14.60

Neck ** $233.41 X 2.17% = $5.06 $5.06

Fat And Bone $10.00 X 3.50% = $0.35 $0.35

296 Ground Lamb $613.96 X 1.95% = $11.97 $11.97

Shrink X 0.35% = 0 0

$244.04

÷ 51.49%

Foresaddle Value: $473.95

232 Loins, Trimmed 4x4 $704.40 X 5.56% = $39.16 $39.16

232 Loins, Trimmed 1x1 $848.49 X 3.81% = $32.33 $32.33

232e Flank, Untrimmed ** $215.74 X 3.22% = $6.95 $6.95

233a Leg, Trotter Off $438.01 X 15.81% = $69.25 $69.25

234 Leg, Boneless, Tied $626.23 X 10.24% = $64.13 $64.13

Fat And Bone $10.00 X 7.56% = $0.76 $0.76

296 Ground Lamb $613.96 X 1.96% = $12.03 $12.03

Shrink X 0.35% = 0 0

Gross Carcass Value: 100.00% $468.64 $224.60

÷ 48.51%

Hindsaddle Value: $463.01

Contact Us: If you need additional assistance, please call our Market 

News team at (515) 284-4460 or email us at websupport.lpgmn@usda.gov. 

December 2021. USDA is an equal opportunity provider, employer and lender.