Lack of market supply should help hold up lamb prices

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A MEAT market analyst and a farming leader yesterday moved to reassure sheep producers that the long-term prospects for this season’s lamb crop were positive.

The statements of Stuart Ashworth, of Quality Meat Scotland, and Charlie Sercombe, livestock committee chairman of the English National Farmers’ Union, follow a 25 per cent fall in the value of lamb in July.

“Given the accepted view that this year’s lamb crop is smaller than last year, the question is ‘why have prices slipped?’ The answer lies in short-term volumes,” said Ashworth.

He explained that Scottish auction sales of lamb in June were 40 per cent lower than last year, while across Great Britain as a whole, auction sales figures lagged 15 per cent below the 2012 figures. However, over the first three weeks of July the volumes reaching Scottish auctions were 7 per cent higher than last year, while Great Britain as a whole was 17 per cent higher.

In a normal season, he said there always was a rapid increase in lamb availability in late June rather than early July and the price slid accordingly but this year, normality was running two or three weeks late. He also believed the recent good weather could have turned consumers towards barbecue products, meaning demand for lamb steadied just as an increased supply became available.

Looking forward, he was very positive saying: “Given a smaller lamb crop and possibly a need for more retentions for breeding, this would leave the market, by historic standards, tightly supplied although in the short-term volumes may stabilise similar to last year’s levels.”

He added the tightly supplied UK market was unlikely to be offset by bigger supplies from other parts of the world. “Although Ireland reported a larger breeding flock in December, they too report the effects of weather and disease have limited the size of their lamb crop.

“With marketings running ahead of last year, they are unlikely to have an abundance of lamb later in the season.

“In New Zealand, ewe numbers have stabilised but weather conditions at mating may result in a lower lamb crop. Again, they are unlikely to be a ready source of abundant supplies of sheepmeat, particularly as they steadily develop opportunities in China.”

Sercombe was also upbeat 
saying: “The prospects for the prime lamb producer remain positive. As a sheep farmer myself, I share the complete frustration that our members have in trying to do business in this volatile market.

“Sheep farmers, particularly those in the uplands, have had a tough year and this is the last thing we want to see. It is unsustainable for the prices to fluctuate like this and it’s bound to have an impact on farmer confidence going forward as well as the weight and the consistency of quality of lambs.”

He encouraged producers to work with their auctioneer or fieldsman to plan their marketing season to even out the supply chain bumps.

But he added he also wanted to see consistent demand with more British lamb on the shelves. “We continue to urge retailers to demonstrate their commitment to British lamb.”