Lamb Market to Stabilise After Vicious Cuts

IFA National Sheep Chairman Sean Dennehy said the lamb market is expected to stabilise in the week ahead after what he described as “vicious factory price cuts last week of up to €1.00/kg”.

He said the facts are the hogget numbers are almost gone, spring lambs are in tighter supply compared to last year and all of the main supermarket groups have switched over to spring lamb. In addition, he said the end of Ramadan is creating increased demand for next week.

The first flush of new season lambs are currently being sold and these will dry up in the next few days, leaving supplies tighter and the possibility of some market rebound.

The IFA sheep farmer leader called on the factories to get off the price cuts agenda, which is undermining the market, and to bring some solid stability to the trade. He said this is critical for confidence at farm level, adding, “It is totally unacceptable the way some agents and factories are talking down the trade when the market signals are more positive.”

Sean Dennehy said that over 10% of the spring lamb kill are currently under finished. He said farmers should only move lambs as they become fit and not be moving any underweight or under finished lambs.

He said major Bord Bia TV promotions for lamb are due to kick off in two weeks’ time and this will drive demand on the domestic market. He said factories will be organising the kill from next week on to meet this.

Sheep farmers, who have come through a really difficult spring with major cost increases, are really angry over the way the factories have excessively pulled lamb prices in just a few days.

Sean Dennehy said the factories have to realise that farmers are also part of the market and are operating on very low incomes. He said the most recent Teagasc figures show the average sheep farmer’s income at only €16,897 per year. “Factory price cuts like we have seen this week seriously damage the market and erode farmer confidence in the sector.”

Sean Dennehy said the facts on the numbers are that for week ending May 27th the kill was back to 53,063 – down 7,344 on the same week last year. In addition, he said the spring lamb kill was 27,249 compared to 36,761 for the same week last year.