Farmers resisting price drop

Despite sheep factories’ best efforts, the big pull on prices was not as successful as they would have hoped. Factories pulled back quotes by 30c/kg last week, which many believe was an attempt to squeeze out more numbers.

However, an improved trade in the UK earlier in the week had boosted demand in the factories. This has led to increased demand for factory-fit lambs and is apparent in the marts where competition was very strong.

Factory agents are commenting that it is difficult to gauge supplies, with a lot of lambs drafted at lighter weights, but they said supplies are expected to rise substantially from now on.

Most farmers are securing prices in excess of €5.50/kg excluding bonuses. When bonuses are taken into account, prices of €5.60/kg to €5.65/kg are common. Producer groups are working on a base of €5.40/kg to €5.45/kg and are securing bonuses of 20c to 30c/kg on top of this, up to a weight limit of 21kg.

Some groups are also getting deals on haulage, which is the equivalent of another 10c/kg added to the price.

Base quotes remain reasonably steady, with most on a base of €5.40/kg. Kildare Chilling reduced its quote by 10c/kg to a base of €5.40/kg excluding bonuses. This is followed by Kepak Athleague and Irish Country Meats, with their quotes of €5.40/kg and €5.30/kg excluding bonuses respectively.

Interestingly, sheep quotes are currently well ahead of the same period last year, with a difference of 50c to 60c/kg. The big differential is helping to boost sheep producers’ confidence in the sector.

IFA national sheep committee chair John Lynskey said the strong market demand and variable number of lambs available for slaughter throughout the country is stabilising prices between €5.50 and €5.70/kg.

Cull ewes

Cull ewe prices are strengthening and supplies are tightening in the marts. Quotes are ranging from €2.60/kg to €2.70/kg. However, higher prices of €2.80/kg to €2.90/kg were paid to carcase weights of 43kg to 45kg.

NI

In the North, quotes have taken a big drop of 20p/kg to a base of £4.40/kg (€5.25/kg). Prices of £4.50/kg (€5.36/kg) are generally being secured by producer groups, but some are digging in their heels, waiting for a price of £4.55/kg (€5.42/kg). Many producers feel the price drop is unjustified given the strong prices paid across the water. Farmers in Scotland are securing £4.90/kg to £5.00/kg (€5.84/kg to €5.96/kg). Some northern groups are contemplating moving lambs across the water unless quotes improve.