The lamb price cuts over recent weeks were excessive and seriously damaged sheep farmers’ incomes. Lamb prices can rebound based on market returns and must be maintained to restore confidence to the sector. These were the strong messages delivered by the IFA President Eddie Downey and National Sheep Chairman John Lynskey in a meeting with all of the major lamb processors and Meat Industry Ireland in Dublin this week.
Eddie Downey said sheep farmers need a return of at least €100 per lamb and the combination of price and weight has to be adequate to deliver this type of return and maintain confidence in the sector. He said “With up to 50,000 additional new season lambs already moved over recent weeks and higher prices in both the UK and France, there is an opportunity to restore and stabilise returns here.”
The IFA President told the factories price cuts of over €1.00/kg or €20 per lamb in a 2 to 3 week period cannot be justified and it clear the price cuts raced ahead of the market. He said based on current UK and French market returns, processors could lift price to Irish farmers.
IFA National Sheep Committee Chairman John Lynskey said there was a major overhang of income problems on sheep farms from last year, with Teagasc recently outlining an income fall of 39% to just €11,160 for 2013. He said sheep farmers must be given the opportunity to recover this year and strong lamb prices are essential to returns. He added the recent price cuts were very disappointing and a major shock to producers.
John Lynskey said with the excellent grass growing conditions farmers should select their lamb carefully to maximise returns and avoid selling under finished or overweight lambs. In addition he called on the factories to make the adjustment on carcase weights up to 22kgs sooner rather than later.
The IFA sheep farmers’ leader said the store trade has already kicked in and the good grass growing conditions were helping the trade. There was a good return for store lamb finishers last year on the back of New Zealand shifting greater volumes out of the EU to China. John Lynskey said a large volume of ewe hogget’s were killed earlier this year and combined with the strong ewe trade, this should help drive the demand for ewe lambs this season.
John Lynskey said consumption remains a real challenge on lamb and the recent price cuts have to be matched with strong promotions from the retailers in order to shift more volumes on the domestic market.
At the meeting with MII it was also agreed to set up a working group between IFA, the lamb processors, Teagasc and Bord Bia on the light lamb trade. John Lynskey said a lot of work needs to be done on the light lamb market going forward across the full area from production to consumption.