"Wood for sheep" is a trade offer in the famous board game "The Settlers of Catan", where one player wants to trade his resource card showing a sheep against some other player's resource card showing a piece of lumber.
Obviously, this can jokingly hint to "wood" / "woody", ie. an erect male penis, for some "sheep", referring to some furry female body-part, ie. vagina.
So "wood for sheep" is a naughty way of insinuating coitus.
It has recently been shouted out on the famous TV show "The Big Bang Theory" when the cast played "The Settlers of Catan".
"Hey, I've got some wood for sheep. (wink)"
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