NAICS 112410 Quarterly Industry Report
Sheep Farming
Comprehensive industry research for valuation professionals, business owners, buyers, and lenders
NAICS Code: 112410Sector: Agriculture, Forestry, Fishing and Hunting (11)Updated: Q1 2026
About This Report
This Fair Market Value industry report (NAICS 112410) provides valuation-focused intelligence for professionals assessing sheep farming businesses. Additional data is drawn from Bureau of Labor Statistics[4], U.S. Census Bureau[5].. Data is sourced from USDA NASS sheep and goat inventory reports[6], USDA ERS lamb market analysis[3], and SBA size standards[7] to support business appraisals, acquisition due diligence, lending decisions, and succession planning for sheep enterprises.
Industry Snapshot
Key metrics for the sheep farming industry.
NAICS Sector
11
Agriculture, Forestry, Fishing and Hunting
Industry Definition & Overview
Sheep Farming (NAICS 112410) encompasses establishments primarily engaged in raising sheep and lambs for meat production, wool fiber, or both, as well as operations feeding lambs for fattening. The USDA National Agricultural Statistics Service[2] reported the U.S. sheep flock at 5.05 million head as of January 2025, marking the first year-over-year inventory increase since 2016. The 2024 lamb crop reached 3.04 million head, with a lambing rate of 106 lambs per 100 ewes. Shorn wool production totaled 22.5 million pounds in 2024, valued at $32.1 million at an average price of $1.43 per pound.
Texas leads the nation in sheep inventory at 670,000 head, followed by California, Colorado, Utah, and South Dakota. An emerging trend shows that 27% of all U.S. sheep and lambs are now hair sheep or wool-hair crosses, reflecting shifting producer preferences toward breeds requiring less labor-intensive management. The USDA Economic Research Service[3] tracks market dynamics including lamb imports, which supply a substantial portion of domestic consumption. Revenue for sheep operations derives from market lamb sales, breeding stock, wool clips, and cull ewe marketing, with growing demand from ethnic communities supporting lamb price strength.
Business valuations for sheep operations must assess flock size, breed composition, and genetic quality alongside land resources, water rights, predator management infrastructure, and wool marketing arrangements. The dual-revenue nature of wool and meat production requires appraisers to evaluate both income streams independently while accounting for the trend toward hair sheep breeds that generate no wool revenue but offer lower production costs.
What's Included in This Industry
- Sector-specific valuation multiples and financial benchmarks for sheep farming operations
- Revenue and profitability analysis across meat lamb, wool, and dual-purpose production models
- SBA size standard classification and lending threshold data for NAICS 112410
- Comparable transaction data from recent sheep ranch sales, flock dispersals, and acquisition transactions
- Breed composition analysis covering wool breeds, hair breeds, and crossbred production enterprises
- Workforce and labor cost benchmarking for sheep ranchers, lambing attendants, and shearing crews
- Industry risk assessment including predator losses, disease exposure, import competition, and wool markets
- Regulatory compliance overview covering animal health requirements, predator management, and grazing permits
- Capital expenditure profiles for fencing, handling facilities, lambing infrastructure, and shearing equipment
- Production efficiency metrics including lambing percentages, weaning weights, and wool yield per head
NAICS Classification Hierarchy
| Level | Description | Code |
|---|---|---|
| Sector | Agriculture, Forestry, Fishing and Hunting | 11 |
| Subsector | Animal Production and Aquaculture | 112 |
| Industry Group | Sheep and Goat Farming | 1124 |
| NAICS Industry | Sheep Farming | 11241 |
| National Industry | Sheep Farming | 112410 |
Related NAICS Codes
| Code | Description | Relationship |
|---|---|---|
| 112420 | Goat Farming | Goat farming operations that share grazing land management practices, small ruminant veterinary services, and livestock auction marketing channels |
| 112111 | Beef Cattle Ranching and Farming | Beef cattle ranching operations that often co-graze sheep on rangelands, sharing fencing infrastructure and predator management resources |
| 313110 | Fiber, Yarn, and Thread Mills | Fiber, yarn, and thread mills that purchase raw wool fleece from sheep operations for processing into textile and apparel industry inputs |
| 311611 | Animal (except Poultry) Slaughtering | Animal slaughtering establishments that process market lambs and cull ewes into wholesale lamb cuts and byproduct materials |
| 424520 | Livestock Merchant Wholesalers | Livestock wholesale merchants and auction markets that support the marketing of breeding stock, feeder lambs, and market-weight animals |
| 115210 | Support Activities for Animal Production | Support activities for animal production including sheep shearing services, livestock guardian animal suppliers, and small ruminant health consulting |
Frequently Asked Questions
Common questions about this industry.
What is the NAICS code for sheep farming?
Sheep Farming is classified under NAICS code 112410, covering establishments primarily engaged in raising sheep and lambs for meat production, wool fiber, or both, including lamb feeding and fattening operations.
What is the SBA size standard for sheep farming?
The SBA[8] sets the size standard for NAICS 112410 at $3.0 million in average annual receipts, qualifying most family-operated sheep ranches for small business lending programs and contracting preferences.
How large is the U.S. sheep industry?
The USDA NASS[2] reported the U.S. sheep flock at 5.05 million head as of January 2025, marking the first inventory increase since 2016. The 2024 lamb crop reached 3.04 million head, with wool production at 22.5 million pounds.
What factors drive sheep farm valuations?
Key valuation drivers include flock size and breed genetics, owned and leased grazing land acreage, water rights, predator management infrastructure, wool marketing contracts, and proximity to lamb processing capacity per USDA AMS[10] market access data.
What is the hair sheep trend and how does it affect valuations?
Hair sheep and wool-hair crosses now account for 27% of the U.S. flock per USDA NASS[2] data. These breeds require no shearing, reducing labor costs but eliminating wool revenue. Appraisers must evaluate whether hair sheep genetics add or reduce enterprise value based on regional market conditions.
Which states lead in sheep production?
Texas leads with 670,000 head, followed by California, Colorado, Utah, and South Dakota per USDA NASS sheep inventory data[6], with western range states dominating production.
What risks affect sheep operation valuations?
Critical risks include predator losses (coyotes, wolves, mountain lions), lamb import competition from Australia and New Zealand, disease exposure including scrapie, limited processing infrastructure, and volatile wool prices tracked by the USDA ERS[13].
What revenue streams do sheep farms generate?
Revenue comes from market lamb sales (primary), wool clips, breeding stock sales, cull ewe marketing, and potential grazing lease income. Growing ethnic community demand supports lamb prices, while USDA conservation programs[14] may provide supplemental income for land management.
Sources & References
Government datasets and editorial sources used in this report.
- [1]U.S. Bureau of Labor Statistics, Quarterly Census of Employment and Wages bls.gov
- [2]USDA National Agricultural Statistics Service nass.usda.gov
- [3]USDA Economic Research Service ers.usda.gov
- [4]Bureau of Labor Statistics bls.gov
- [5]U.S. Census Bureau census.gov
- [6]USDA NASS sheep and goat inventory reports nass.usda.gov
- [7]SBA size standards sba.gov
- [8]SBA sba.gov
- [9]SBA-backed lending sba.gov
- [10]Lamb Promotion, Research, and Information Act ams.usda.gov
- [11]SBA 7(a) loans sba.gov
- [12]504 loans sba.gov
- [13]USDA ERS ers.usda.gov
- [14]USDA conservation programs nrcs.usda.gov
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