Sheep Trends: factories resisting paying €8/kg

Factory agents are under pressure to attract higher numbers on to the market, but are resisting giving agents the green light to pay €8/kg.

The tightness in supply is clearly seen in last week’s sheep kill figure of just 41,041 head.

Throughput is marginally down on the previous week, but has fallen by almost 14,000 head in the space of just three weeks.

Looking at the kill year on year, throughput is running over 20,000 head lower on the corresponding week in 2023 with year-to-date throughput now running over 250,000 head lower.

Factory quotes for this week remain at a range of €7.60/kg to €7.80/kg for quality assured lambs.

A high percentage of lambs are trading from €7.70/kg to €7.85/kg, with lambs traded from regular sellers and availing through producer groups of conformation bonuses selling to €7.90/kg.

Agents remain reluctant to pass this point and are resisting pressure to sanction deals of €8/kg. It is clear that agents active in marts are achieving higher prices owing to the prices paid, but this is not being sanctioned to groups or sellers with significant numbers.

There is a preference in some negotiations to allow higher carcase weight allowances or to cover all or part of transport costs where large numbers are being transported by a haulier.

Many plants have also reduced the number of days they are slaughtering due to the lower throughput levels.

The ewe kill last week of just 4,441 head is almost half the number slaughtered in the corresponding week in 2023.

Demand for ewes has jumped in many mart sales this week, with prices up anywhere from €15 to €30 per head for heavy fleshed ewes.

The presence of buyers purchasing ewes for live export or for slaughtering here and exporting in carcase form has added significant competition to the trade.

The live trade has moved well ahead of the dead trade, with quotes remaining at a range of €3.70/kg to €4/kg and a top of €4.40/kg in Ballon Meats.

Sellers should study the market carefully, especially for heavy ewes. Carcase weight limits are typically 43kg to 46kg, although there are some deals now being completed to try to compete with the live trade.

Northern trade

Base quotes in Northern Ireland remain at £6.25/kg. This is the equivalent of about €7.52/kg, with lamb prices in Northern Ireland not receiving the flat rate vat top up that farmers unregistered for VAT in Ireland receive.

Reports indicate that factories are also struggling to compete with a vibrant live trade and are paying 10p/kg to 15p/kg above quotes to try to negotiate sales.

The number of sheep exported south for direct slaughter fell by over 600 head to about 5,000 sheep. Steady exports continue to Britain and the Netherlands.