Tight supplies force factories to pay more

Tight supplies forced factories to lift their quotes and pay more for lamb this week. After pulling quotes down to as low as 425c/kg factories are now offering base quotes of 440c/kg for today (Thursday). 450c/kg continues to be readily available across the country and 455c/kg up to 21.5kg was given last Monday by some to get their hands on lambs. With the weekly kill running at least 15% back (8-9,000 head) on last year and farmers refusing to feed expensive creep feed, a major flush of lambs is now not expected until July. The bigger problem for some factories is actually under finished lambs not over fat ones, another sign that supplies will be slow to increase before then.

You just have to look in the marts where butchers and wholesalers are pushing the best lambs over €90 to see how tight good lambs really are. This price equates to over 470c/kg in carcase form.

The same situation is happening in Britain where numbers continue to be very tight. With the hoggets out of the picture factories there are paying up to 370pstg/kg for spring lamb. This translates into 492c/kg incl VAT, well above current Irish levels. Northern plants also had to reverse their quote cuts and them back up to 330pstg/kg or 439c/kg incl VAT. The fact that they are actively paying higher in the marts in some case, competing against at least one southern plant, shows they need to lift their quotes even more.

IFA National Sheep Chairman Henry Burns said that the lamb trade turned a very significant corner in the last week. He said the factories tried to collapse prices but failed because farmers refused to give them cheap lamb and supplies remain scarce. He said prices in the marts had also lifted significantly this week with quality lambs making up to €100 per head. In France, Henry Burns said factories are getting the equivalent of 500c/kg for Irish lamb and could well afford to return 460c to 470c/kg to Irish producers.