Positive from France - negative from factories

By Justin McCarthy

Lamb prices have eased slightly over the past week. While last week some farmers had managed to secure up to 390c/kg, with rumours of 400c/kg being paid, 380-385c/kg appears to be the limit this week with some factories now trying to buy at 365-370c/kg. Quotes range from 360-370c/kg. The only real positive this week is that some farmer shave been paid on up to 23kg.

Factories are attributing the easing in price to an increase in the number of under finished lambs being presented for slaughter plus strong competition from English lamb on the French market. There is no doubt that lack of sun has had a major impact on lamb thrive over the past 3-4 weeks. As a result an increase number of lambs are now grading O2. Farmers would be well advised to handle and weigh lambs before selling as some plants are imposing 30-40c/kg penalties for light under fleshed lambs. IFA National Sheep Chairman Henry Burns said factories need to lift the price for quality lambs to make it more viable for producers to introduce meals to finishing lambs in the current difficult conditions.

There has been a significant increase in the number of light hill lamb slaughtered over the past 2-3 weeks. While well fleshed lambs ranging from 10-15kg carcass weight are selling from 300-320c/kg under fleshed lambs are back to 280c/kg. In the mart the prices paid for factory lambs have remained steady at €77 per head while butcher lambs sold from €84 to €88 per head The continued spell of wet weather has saw the demand for store lambs ease with prices back €1 per head.

Britain

In Britain despite an increase in the number of lambs on offer favourable exchange rates have seen farmers being paid from 290-295pstg/kg. With €1 the equivalent of 80pstg this equates to 381-388c/kg (inc VAT). Based on the €/£ exchange rate for the same week last year 290pstg/kg would have equated to 442c/kg (inc VAT). The SQQ price has slipped back from last weeks average of 128pstg/kg to 122pstg/kg or the equivalent deadweight price of 346c/kg inc VAT. In the north some factories have pulled quotes by 5pstg/kg. Quotes now range from 275-285pstg/kg (361-374c/kg inc VAT).

While the value of sterling has increased over the past week factories in NI and Britain still have a distinct advantage when selling into the French market. The availability of cheaper British lamb has saw the French price slip from 430c/kg excl VAT to 400kg excl VAT

Kill down 12%

Bord Bia figures show that the lamb kill is currently running 12% or 23,000 head behind last year. At 383c/kg the average price paid this year has increased by 7%.

French meeting

The outcome from the French meeting in Limoges on the future of the sheep sector was positive. All parties agreed that action was required to stop the mass exodus out of the sector.

It is likely that this action will be in the form a sheep maintenance payment. With so many false promises having been made to sheep farmers to date it is unlikely that they will get to excited until they see the payment in the post.