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Independent.ie

Sunday 4 December 2016

IFA fires first salvo in annual lamb price war

Published 25/01/2012 | 06:00

The opening shots in the annual lamb price battle have been fired, with the IFA claiming that a starting price of €7/kg for spring lambs will be essential to keep early lamb production in Ireland.

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IFA sheep chairman James Murphy said that early season lamb producers needed a "realistic start" to spring lamb prices, and anything lower than €7/kg would cause a drop in early lamb production in the coming years.

However, factory sources have insisted that speculation about prices for Easter lamb is pointless at this early stage.

"The way the trade is at the minute, we can't predict what the price will be in two day's time, never mind two month's time," insisted one factory spokesman.

Another factory source described €7/kg as "unrealistic", adding that prices would probably start at €6.50/kg.

Nonetheless, he admitted that €7/kg was possible.

"There is a chance that they could reach €7/kg but that would require an awful lot of factors to move in farmers' favour," he added.

Those factors include the strength of sterling, the availability of cheaper New Zealand imports into Europe at Easter time and the willingness of buyers to pay higher prices for lamb.

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Strong sterling would work in Ireland's favour, making Irish lamb more attractive. In addition, supplies of cheap New Zealand lamb will be down.

Bord Bia figures for 2011 show that by mid-November New Zealand had only supplied 73pc of its import quota as it had sent more lamb to new markets like China.

Factors working against high spring lamb prices include a predicted 2-5pc increase in the lamb supplies for slaughter this year and a €3 drop in demand for lamb skins, from €9 to €6.

Factory sources also warned that a higher lamb price could result in consumers switching to cheaper meats such as pork and chicken.

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