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Market analysts are forecasting a bright spring period for the sheep trade, with the short- to medium-term outlook pointing to a sustained period of higher prices.
Fuelling this expectation is the dwindling pool of lambs likely to come on to the UK market in December after producers forced on lambs to meet the last Brexit deadline of 31 October.
The carryover of lambs into 2020 is expected to be much lower than previous years, and with the potential for a no-deal Brexit at the end of January 2020 looking unlikely, there is more confidence in the sector.
In addition, New Zealand, which normally fills the supply gap in the British market in the first half of the year, is increasingly turning its attention to China and the demand created there by African swine fever in pigs.
New Zealand lamb exports to China are up 16% this year, and expected to increase further in 2020. Meanwhile, exports to the EU are down 17% this year, and to the UK are down 25%.
With domestic prices in New Zealand currently at a sterling equivalent of 447p/kg, there is little incentive to move lambs to the northern hemisphere.
The gap in the EU market has also created an opportunity for UK suppliers, with exports to the continent up by 16% in September and October.
That has all contributed to a strong price in Britain, which is now 40p to 50p/kg ahead of NI.
Deals
Base quotes in NI remain on 390p/kg, with farmers reporting deals being made at 395p/kg for numbers, with butcher type lambs making 400p/kg at the top end of the market.
In contrast, lamb prices in Britain start from a base of 420p/kg, with 430p to 440p/kg being paid earlier this week. Lamb prices in Britain are currently at their highest December level since 2011.
While the NI price has risen from the 350p/kg paid in mid-November, factory agents maintain that the reason the price in NI has stalled for now is because more lambs have come to the market in recent weeks.
Also, there are reports that competition from buying agents working on behalf of southern plants has eased as Irish processors look to manage throughput.
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