| 16.4°C Dublin

Farmers encouraged to stand firm to nail ¤5/kg

The factories have had to do an Enda Kenny by backing down and accepting that farmers are not going to sell at the lower quotes. The cry that the continuous drop in prices throughout June could not continue into July was clearly heard and farmers' refusal to sell at the reduced prices has resulted in many plants agreeing to deals of up to and over the €5/kg again.

Farmers who accept less are bargaining for better weights and there are reports in the west of a farmer who secured 480c/kg up to 23kg, which is worth €110/lamb. Another farmer got 510c/kg paid up to 22kg on the eastern side of the country.

And still there are farmers who have accepted the base quote of 470c/kg plus the bonus to 21.5kg, taking €102/hd for their stock. Not only are they losing €8-10/lamb but they are doing their fellow farmers absolutely no favours.

Now to the quotes. A 25c/kg jump since this day last week puts Moyvalley Meats in the lead on an all-in 485c/kg. Kildare's base of 475c/kg plus the 6c/kg and the 5c/kg bonuses also puts them up there with their neighbours.

Thereafter, a 10-20c/kg increase elsewhere has the Kepak plants, the ICM plants and Dawn Ballyhaunis all on the same quote of 470c/kg plus the bonus. Despite this improvement, if you are selling at those figures you are not maximising the value of your lambs and it is vital that you try to negotiate for much closer to and over the €5/kg, while at the same time getting the carcass weight up to a minimum of 22kg.

At the risk of repeating myself, just remember that at those prices, every half kilo is worth €2.40-2.50.

IFA sheep chairman James Murphy said farmers had realised that supplies are scarce, and strong sellers were negotiating better deals.

Both ICM plants and Kildare are offering 270c/kg for cull ewes. Kepak Hacketstown is quoting 260c/kg and the two western processors are on 250c/kg. Moyvalley are quoting a low of 230c/kg.

On a year to date basis, sheep supplies are almost 2pc higher than the corresponding period last year. In the latest December livestock survey release, the CSO reported that the national sheep flock fell by almost 2pc to 3.1million head on 2009 levels, although the decline in the breeding flock was somewhat lower at 1pc to 2.4 million head.

A recovery in the sheep trade was evident over the past week, according to Bord Bia, as supplies on both the domestic and key export markets tightened.

Some improvement in market demand on the domestic market has also boosted the trade.

Quotes for spring lambs rose by around 15c/kg, with quotes reaching 470c/kg by the end of the week. Falling lamb supplies have helped maintain trade for manufacturing demand, with cull ewe quotes typically still making around €2.50-2.70/kg.

In Britain, the spring lamb trade during the week strengthened as supplies began to tighten, this coupled with some improvement in market demand helped the trade. By the weekend live market prices stood at the equivalent of €5.31/kg inclusive of VAT for new season lambs.

In France, the trade benefited from some increase in market demand, particularly in southern France where supplies are reportedly tighter than usual. Towards the end of the week, Irish grade 1 spring lamb were making up to €5.31/kg.

Indo Farming