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Mixed fortunes for new-season British lamb
Published:  10 July, 2017

The Welsh lambing sector has received a boost from an improved number of new-season lambs, coupled with an increase in prices. 

For the months between March and the end of June, there was an rise of 22% for new-season Welsh lamb entering into the market compared to the same period in 2016. In England, this figure stood at 26%.

While the value of new-season lamb standard quality quotation (NSL SQQ) for the week ending 1 July was 15p down on the previous week, this is still a 19p rise year on year.

John Richards, industry information executive for Hybu Cig Cymru – Meat Promotion Wales (HCC), is remaining positive about the outlook. “Lamb prices over the last month have been significantly stronger than those during the same period last year,” he commented.

“This is linked to the weaker sterling, which has led to UK exports bringing better returns to our exporters, with the benefits subsequently felt by producers here in Wales. We also saw less of last year’s lamb on the market during June, which also helped the trade.”

He claimed that, in Wales, the number of lambs sold weighing between 32-39kg increased by almost a third. “The pattern is even more evident at English auction markets, as reports show that throughputs were more than 50% higher in this weight category than in the same four-month period last year,” he explained.

“The liveweight lamb trade in Wales held up at historically high levels for much of June, but prices have eased slightly in the last few weeks to match the expected seasonal trend.”

HCC expects that all of the UK’s supermarkets will start sourcing local lamb in the coming weeks, a move that has the potential to improve demand, while the export market is expected to remain strong due to the exchange rate.

“These factors should have a positive impact on the market. However, as always, the supply of lambs will dictate price fluctuations,” concluded Richards. “The coming month will give us a better understanding on the true market situation. Last year the market was significantly affected due to the EU referendum in late June, which caused sterling to fall dramatically.”

Meanwhile, in Northern Ireland, the Ulster Farmers’ Union (UFU) has called on processors to help in restoring stability in the sheep market following on from recent price reductions for local lamb.

“The recent strength in the market brought some welcome confidence back into the sheep sector,” said UFU beef and lamb chairman, Crosby Cleland. “Prices have been stable, giving farmers more flexibility with marketing lambs at the specified weight range.” This, however, has been counterbalanced by processors that are looking to pull back prices, as lamb numbers coming into the market are on the rise.

“This isn’t unexpected, given that prices traditionally drop back from June into July. But farmers will now be concerned about what lies ahead for the rest of the year, given their sense of disappointment about this reversal in fortunes.”

The UFU said that, in recent times, prices have not moved by much more than 20p a kilo from July to autumn. “Assuming sterling does not strengthen against the euro, there is no reason why processors cannot deliver at least what is currently being paid over the course of the next few months,” said Cleland.

“If processors act responsibly and deliver strong, stable prices, they will get the consistent supply of in-spec lambs they need. But if they opt to cut prices further, this will destabilise the market and that’s not in anyone’s interest.”