Farm Ireland

Sunday 17 December 2017

Sheep factory prices are not storming, unlike the weather


Joe Healy

The factory trade, unfortunately, bears a closer resemblance to our rugby team than the climatic conditions for the early part of this week.

Five weeks ago, all of the plants were quoting in a range of 470-475c/kg, while today all bar one are down at base quotes of 445-450c/kg. This is equivalent to €4.40-5.00/lamb.

And the downward pressure continues, with Dawn Ballyhaunis and the two ICM plants pulling their quotes by another 5c/kg today, leaving them on 445c/kg plus the 6c/kg bonus.

Mid-September is a fairly critical time in the sheep calendar and quite often dictates the lamb flock for next year as farmers decide on numbers to let off with the rams. So factories should realise that killing optimism in the sheep industry during this period could probably be classed as a bit short-sighted on their part.

I suppose the good news is that regardless of the figures being quoted, farmers are successfully negotiating prices of up to 10-15c/kg more with 465c/kg quite freely available and more for some of the producer groups.

Some of those groups are getting up to and over 470c/kg. The key is to make a price and agree on a carcass weight before you sell.

At least you then have an idea of what you will end up with. Otherwise you will be taking the minimum on both fronts.

Moyvalley are offering an all-in quote of 460c/kg, which is unchanged since last week. Others retaining the status quo are Kildare Chilling where 450c/kg plus 6c/kg plus the quality assurance bonus of 5c/kg is being quoted. Both Kepak plants also held steady where the quotes are 450c/kg plus 5c/kg. The other three referred to above are down at a base of 445c/kg.

Also Read

The IFA's James Murphy said that hard sellers and producer groups were securing prices of 470-475c/kg for their lambs.

If you have ewes however, the ICMs are leading the way with quotes of 270c/kg. Kepak Hacketstown and Kildare remain at 265c/kg, with 250c/kg on offer from the western plants. Moyvalley are not quoting.

According to Bord Bia, the sheep trade was relatively steady throughout the past week as supplies matched demand levels.

Quotes for spring lambs for most of the week were making between €4.50-4.60/kg. The cull trade remained firm with prices typically still making between €2.50-2.70/kg.

On a year to date basis, sheep supplies are running almost 2pc higher than the corresponding period last year.

In Britain the trade eased as larger volumes of lamb emerged onto the market. By the weekend live market prices fell by around 5/c to 458c/kg including VAT for new season lambs, with factory prices of up to 465c/kg available.

In France, supplies from Britain remain strong and there was little change in trade throughout the week.

Prices for limited volumes of Irish grade 1 spring lamb were reported to be making around €4.90/kg inclusive of VAT by the end of the week.

Meanwhile, the latest forecasts from Beef & Lamb New Zealand (BLNZ) show some recovery in export lamb supplies for the 2011-12 marketing season as increased lambing percentages are expected to offset some fall in the breeding ewe flock.

While export lamb supplies are expected to increase by almost 6pc to 20.1m head for the 2011/12 campaign, this will represent the second lowest level of export lamb supplies in 51 years, with the 2010-11 campaign being the lowest. Lamb exports in value terms are expected to be largely unchanged despite some increase in export volumes, as prices are expected to be affected by some further strengthening in the NZ dollar.

Indo Farming