It's so weird all the different names they have for groups of animals. They have pride of lions, school of fish, rack of lamb. . . .

The joke plays on the quaint, specialized collective nouns used for animals (“pride,” “school”), then abruptly shifts to a culinary term (“rack of lamb”) that is not a collective noun at all. The humor comes from the misdirection: the listener expects another zoological grouping, but gets a menu item—collapsing the distance between animals in nature and animals as food. It also lightly satirizes how arbitrary and overly ornate some collective nouns can feel in everyday speech, suggesting that once you start listing them, the pattern is easy to spoof. The ellipsis underscores the sense that the list could keep going, inviting the audience to anticipate (and be surprised by) the punchline.