Lamb outlook on track despite winter dip

Both livestock auctions and deadweight buyers expect a generally tighter availability to maintain good returns to finishers, despite the seasonal arrival of regular New Zealand supplies.

Livestock Auctioneers Association executive secretary, Chris Dodds, said supply and demand were generally in the sellers’ favour and export volumes continued firm.

However, there was a ceiling beyond which it would perhaps be in no-one’s interest for prices to rise.

“While we have got to see lamb pitched at a sustainable level for farmers, at the same time, the retailers have to be able to sell the product.”

And the comment was echoed by Dunbia’s group procurement manager, Wyn Williams, who said sustainability for everyone in the chain was dependent on a healthy uptake by consumers.

With low percentage margins in both processing and even retailing, maintaining volumes was critical. No-one, he said, would benefit from consumers switching from lamb in favour of alternatives such as chicken and pork.

Market easier to read

But he confirmed prices had recovered and the level of stability in the market was now easier to read without the ‘weather effect’.

The impact of snow and ice on both the movement of livestock off farms – in some cases higher than normal numbers when the weather permitted – and an inability of some exporters to get container loads of carcases to the docks and on to vessels, is being suggested as one of the main reasons for the temporary dip in hogget prices.

Most people in the trade however still suspect that earlier predictions of an overall shortage of numbers will prove correct by the end of the hogget season, with one processor suggesting we would see an ongoing trade within the 380p-420p/kg bracket.

Livestock markets too are again reporting prices for export and best lambs well over the £2/kg mark.

In fact, in Welshpool on Monday, medium weights topped at 240p/kg and averaged just over £2/kg with standard weights just 5p behind. Export hoggs in Ludlow were over 220p/kg and in Oswestry the overall market average was 181p/kg.

Stronger trading

Further north in Gisburn, Monday trading was stronger with overall averages at £80 (201p/kg).

AHDB Meat Services figures show the SQQ for the end of last week at just over 183p/kg, but this reached 193p/kg by Tuesday, and was looking like increasing again by a few pence on Wednesday. The overall deadweight average for the end of last week was 410p/kg.

The sheepmeat market is further underpinned by a continuing strong trade for cull ewes, many of them destined for the Halal market. In fact, a new research project has been commissioned by the newly-formed Halal Steering Group, established by Eblex.

It will examine how best to exploit what Steering Group member and Janan Meat director, Naved Syed, said was a potential £1 billion market.

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