Store lamb prices hit by scramble for fodder
Traditional buyers opting to grow silage rather than finish lambs
The soaring demand for fodder among dairy farmers is having an impact on store lamb prices as traditional finishers are opting to grow silage for milk suppliers rather than finish lambs.
This is exacerbating problems in the store trade, with demand for lambs already being hit by the shortage of grass on farms across the east and southeast, and by fears that the introduction of electronic tagging from October 1 will cause further disruption.
John Brooks of the ICSA said there had been a marked fall-off in the level of demand for store lambs this summer.
He attributed this to the shortage of grass supplies in the east and southeast.
However, he said the decision by many drystock farmers to grow silage for neighbouring milk suppliers was also a factor.
Mr Brooks said he had heard of numerous cases where farmers who traditionally bought store lambs were cutting extra silage instead this autumn.
Mr Brooks said there was a potential crisis facing store lamb producers as a result of the drought and a shortage of buyers in the marts for stock.
"The shortage of grass will deter many of the traditional customers for store lambs.
"It is a particular concern for hill farmers but the problem is not exclusive to hill farmers," he explained.
"Hill farmers rely on selling their lambs to lowland farmers as their land is not suitable for fattening lambs. However, there are also many lowland farmers who offload store lambs in the early autumn in order to prioritise grass for ewes at breeding time," Mr Brooks added.
Mart managers report a drop of €5/hd for light lamb over the last month, with the poor demand being camouflaged to some extent by the small numbers of lambs being offered.
Most were selling for around €2/kg this week, with prices generally ranging between €67/hd and €85/hd in Carnew Mart.
However, lower prices are being reported for lower quality stock.
Mr Brooks said cashflow difficulties were emerging on lowland farms, as the additional costs associated with the drought, and lower stock prices, began to bite.
"We also know that some lambs are being killed in factories which are too light and this has been a factor in price drops in recent weeks."
He said this was indicative of the cashflow problems that drystock farmers were facing.
"It is critical that banks understand the need to support the sheep sector. [The] ICSA believes that banks must step up to the plate for the sheep sector. This is about short term working capital for farmers in the sector.
"Potential customers for store lambs will be in a stronger position if they can spread adequate fertiliser when the rain comes," Mr Brooks said.
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