Some sheep factories have taken the decision to pull back base quotes for spring lambs as we approach the June bank holiday.
One factory agent said much of the buying for Ramadan is now complete and with bank holidays in Ireland and France coming up, the decision was taken to be extra cautious buying over the next few days.
However, the extent of the price pull is variable, with Kildare Chilling reducing base quotes by just 10c/kg on last week’s prices to a base of €6.00/kg excluding bonus payments.
On the other hand, Irish Country Meats and Kepak have pulled their quotes back by 20c/kg to 35c/kg respectively, to a base of €5.80/kg.
Factories claim there has been a big increase in lamb numbers being booked in for slaughter over the last few days. Higher numbers, combined with what they describe as a more difficult trade in key export markets, is their rationale for the price reductions.
However, the reductions may be a matter of factories taking a wait-and-see approach to establish if their attempts will be a success.
Farmers will be hoping this lull will only be short term and some are sceptical that the reduced quotes are an attempt by factories to reduce farmers’ price expectations as we head into June.
On the ground, farmers are securing prices of €6.00/kg to €6.20/kg. This is a reduction of 10c/kg on prices paid last week, but is still ahead of factory quotes.
Some farmers are also successfully negotiating higher weight limits of 21kg, which is helping to offset the reduced prices.
Strong demand
IFA national sheep chair John Lynskey said there is very strong market demand for lambs, with factories paying €6.10/kg to €6.20/kg and top prices of €6.30/kg to €6.35/kg this week.
He said attempts by factories to pull quoted prices were not justified in terms of the strong market demand. John said the IFA is set to meet the lamb factories later this week and will highlight the need to ensure that prices are stabilised and that Irish factories do not undermine the market at this critical time in the season.
The IFA is also set to meet the Department of Agriculture on the clean sheep policy.
Bord Bia will be starting its spring lamb promotion to coincide with peak supplies of 2017 new-season lamb and will co-ordinate its TV quality assurance promotion campaign for three weeks in June and also in October.
Cull ewes
Cull ewe prices remain steady, with prices ranging from €2.50/kg to €2.70/kg, with demand reportedly high in the west. Carcase weight limits range from 40kg to 45kg.
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