Sheep farmers can look forward to positive performance in sheepmeat markets in 2025, with tight supplies forecast to maintain a strong floor under the trade.
Speaking at Friday’s Bord Bia Meat Market Seminar, Seamus McMenamin told delegates that Irish supplies will remain tight in at least the first quarter of 2025, with a similar low carryover of hoggets predicted as in 2024.
A similar situation is predicted in the majority of sheep-producing nations in Europe, with longer-term forecasts also pointing to further significant contraction in breeding ewe numbers.
Bord Bia predicts that production in Europe will fall by in the region of 1.8% in 2025. This follows on from a sharp reduction in 2024 and takes a best-case scenario, with the impact of bluetongue on production remaining a major concern and now added to by concerns relating to foot-and-mouth disease in Germany.
Changing landscape
Seamus told delegates that the changing landscape of sheep farming across Europe is also influencing and changing market dynamics.
He outlined that with the sharp fall in production, reflected in Figure 1, there is a shift in product demand in some key markets, with growing demand for imports in carcase rather than value added product. This is providing less opportunity for Irish processors to exploit opportunities to add value.
Figure 1: EU production in the majority of sheep producing nations is forecast to fall in the coming years. \ Bord Bia.
The higher prices witnessed in 2024 (€7.79/kg v €6.60/kg in 2023) has been vital for the future sustainability of farmers, but it has had some negative consequences for sheepmeat consumption.
An analysis of Irish retail sales for the 52 weeks ending on 29 December 2024 shows sales volumes reducing by 10%, while consumer spending on sheepmeat has reduced by 8%, with 7% fewer buyers and shoppers purchasing 3% less frequently and 3% less in terms of quantity.
However, it is not all doom and gloom, with some growth in new consumers purchasing sheepmeat, ranging from 5% to 10% across many markets in Europe.
Seamus outlined that a key focus of Bord Bia promotional activity in 2024 and 2025 is targeting younger consumers, while also being careful to protect traditional lamb consumers.
Higher imports
There is also a growing influence in many markets on the Halal trade and this is being reflected in a vibrant trade for mutton.
The shortfall in production will undoubtedly increase sheepmeat import volumes in both the EU and UK, but Seamus expects this to be below historical levels.
He highlighted that New Zealand filled 55% to 56% of its tariff-free quota of approximately 114,000t in 2024 and while this could increase in 2025, it is not predicted that it will return to historically high levels of over 80%.
Seamus McMenamin speaking at Bord Bia Meat Market Seminar.
The increase in import volumes will only be served by New Zealand diverting sheepmeat from other markets and in particular if it continues to lose market share to Australian sheepmeat in the Chinese market, with production also falling and unlikely to recover.
It is expected that Australian sheepmeat exports to the UK will increase in line with their higher tariff-free quota under the Australia-UK free trade agreement.
Supply-demand balance
Demand is expected to be particularly strong for key religious festivals. This includes the Islamic festival of Ramadan, which starts at the end of February and finishes with Eid al-Fitr on 31 March 2025.
Easter Sunday falls on 20 April, while the second key Islamic religious festival of Eid al-Adha runs from 6 June to 10 June.
In addition to a lower carryover of hoggets, the supply of sheep in 2025 is forecast to be influenced by a continued shift to later lambing, with more farmers, according to Seamus, focused on grass-based production.
Higher prices in the second half of the year and better returns for lambs carried over to the following year is also encouraging more farmers to consider such a production system.
Sheep farmers can look forward to positive performance in sheepmeat markets in 2025, with tight supplies forecast to maintain a strong floor under the trade.
Speaking at Friday’s Bord Bia Meat Market Seminar, Seamus McMenamin told delegates that Irish supplies will remain tight in at least the first quarter of 2025, with a similar low carryover of hoggets predicted as in 2024.
A similar situation is predicted in the majority of sheep-producing nations in Europe, with longer-term forecasts also pointing to further significant contraction in breeding ewe numbers.
Bord Bia predicts that production in Europe will fall by in the region of 1.8% in 2025. This follows on from a sharp reduction in 2024 and takes a best-case scenario, with the impact of bluetongue on production remaining a major concern and now added to by concerns relating to foot-and-mouth disease in Germany.
Changing landscape
Seamus told delegates that the changing landscape of sheep farming across Europe is also influencing and changing market dynamics.
He outlined that with the sharp fall in production, reflected in Figure 1, there is a shift in product demand in some key markets, with growing demand for imports in carcase rather than value added product. This is providing less opportunity for Irish processors to exploit opportunities to add value.
Figure 1: EU production in the majority of sheep producing nations is forecast to fall in the coming years. \ Bord Bia.
The higher prices witnessed in 2024 (€7.79/kg v €6.60/kg in 2023) has been vital for the future sustainability of farmers, but it has had some negative consequences for sheepmeat consumption.
An analysis of Irish retail sales for the 52 weeks ending on 29 December 2024 shows sales volumes reducing by 10%, while consumer spending on sheepmeat has reduced by 8%, with 7% fewer buyers and shoppers purchasing 3% less frequently and 3% less in terms of quantity.
However, it is not all doom and gloom, with some growth in new consumers purchasing sheepmeat, ranging from 5% to 10% across many markets in Europe.
Seamus outlined that a key focus of Bord Bia promotional activity in 2024 and 2025 is targeting younger consumers, while also being careful to protect traditional lamb consumers.
Higher imports
There is also a growing influence in many markets on the Halal trade and this is being reflected in a vibrant trade for mutton.
The shortfall in production will undoubtedly increase sheepmeat import volumes in both the EU and UK, but Seamus expects this to be below historical levels.
He highlighted that New Zealand filled 55% to 56% of its tariff-free quota of approximately 114,000t in 2024 and while this could increase in 2025, it is not predicted that it will return to historically high levels of over 80%.
Seamus McMenamin speaking at Bord Bia Meat Market Seminar.
The increase in import volumes will only be served by New Zealand diverting sheepmeat from other markets and in particular if it continues to lose market share to Australian sheepmeat in the Chinese market, with production also falling and unlikely to recover.
It is expected that Australian sheepmeat exports to the UK will increase in line with their higher tariff-free quota under the Australia-UK free trade agreement.
Supply-demand balance
Demand is expected to be particularly strong for key religious festivals. This includes the Islamic festival of Ramadan, which starts at the end of February and finishes with Eid al-Fitr on 31 March 2025.
Easter Sunday falls on 20 April, while the second key Islamic religious festival of Eid al-Adha runs from 6 June to 10 June.
In addition to a lower carryover of hoggets, the supply of sheep in 2025 is forecast to be influenced by a continued shift to later lambing, with more farmers, according to Seamus, focused on grass-based production.
Higher prices in the second half of the year and better returns for lambs carried over to the following year is also encouraging more farmers to consider such a production system.
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