Factory lamb price cuts of 50c/kg to 60c/kg have rocked lamb finishers and, with input costs escalating, left many in a loss-making position.

While price quotes appear to have steadied this week at an average lamb price of €6.00/kg to €6.10/kg, they remain 50c/kg to 70c/kg behind the corresponding period in 2022.

This equates to an €11 to €15 fall on a typical 22kg carcase, without taking into account that input costs are 30% to 45% higher.

Processors are blaming poor demand in export markets linked to reduced consumer spending, inflationary pressures and market uncertainty due to reports of high volumes of New Zealand lamb entering the market for the recent price cuts.

The situation has prompted the IFA to convene a crisis sheep industry meeting for Monday 23 January at 8pm in the Radisson Blu hotel in Athlone, Co Westmeath.

At the meeting, Teagasc will present an update on the latest evaluated costs of production for sheep enterprises, while a lamb market outlook for 2023 and current market insights will be delivered by Bord Bia and Irish Country Meats (ICM).

IFA president Tim Cullinan said “factories’ downwards price pressure is not acceptable. Input costs on sheep farms have increased in the past 12 months by over 40%, and sheep farmers do not have the capacity to absorb this increase, which has eroded the income levels in an extremely vulnerable sector”.

‘Real concern’

IFA sheep chair Kevin Comiskey has accused Minister for Agriculture, Charlie McConalogue, of failing to provide sufficient direct sheep farmers supports as adding to the financial pressures posed by low prices.

“There is real concern within the sector for the spring trade and action needs to be taken immediately,” he said.

Meanwhile, the Department of Agriculture reports that 19,165 farmers have applied to the Sheep Improvement Scheme.

The application figure is higher than anticipated, and represents an increase of over 1,000 more farmers than are currently participating in the Sheep Welfare Scheme.