Lamb prices steady as supplies tighten

Tighter supplies for spring lamb through the factory gates in Ireland and Britain have seen prices remain steady, with less New Zealand lamb entering the UK market.

So far 1.39 million head have been through the factory gates, up 11pc or 133,000 on 2016.

However, the numbers being processed stood at 58,000, back 3pc or 2,000, for the week ending July 8 compared with the same week in 2016.

Spring lambs so far are back 4pc compared with last year.

Bord Bia's sheep market analyst Declan Fennell said the supply and demand have remained tight but inevitably the numbers would start to build up.

Mr Fennell said a "big factor" has been the tighter numbers for spring lamb in the UK market. He pointed out that less New Zealand lamb was entering the UK with sterling having an impact on trade.

Figures for May show the volume of Kiwi chilled lamb exports into the UK were back 35pc. Mr Fennell said there was a tightness of supply in New Zealand, coupled with the country sending more lower value lamb cuts into China.

UK retailer Sainsbury's, joined the Co-op and Morrisons, in announcing all its fresh lamb will be 100pc British.

However, Mr Fennell pointed out they were already in the early to high 90s in terms of the percentage of UK stock already on the shelves.

He said it did work as a reminder that UK consumers were being urged to buy local and reinforces the need for promotion that is underway on the continent.

In the long-term, Mr Fennell said the new trade agreement with Japan could be a "treasure chest" for exports as it was an affluent society.

Both the IFA and the ICSA pointed out farmers are receiving around €5.50/kg for spring lamb, with some dealers hitting €5.60/kg for agreed numbers.

The ICSA's John Brooks said there is also talk among exporters of buying beginning for live shipments. He pointed out this is a valuable trade that must be targetted.

The IFA's John Lynskey said the trade remained positive. However, he claimed the differences between the prices quoted by the factories and those paid to farmers was impacting negatively on average prices agreed for producer groups.