According to figures from the week ending 23 March, prices for old-season lambs at Welsh auction markets increased by 40p/kg during the last month to 193p/kg. However, the prices are still 20p/kg down year on year (YOY).
However, market returns for lamb have risen steadily since the start of the year, despite difficult conditions towards the end of last year. Prices dropped significantly in the second half of 2012 due to the weather and the crisis in the eurozone, which saw increased imports of cheaper meat.
Industry information officer for HCC John Richards explained that lamb prices would usually receive a boost around Easter, as demand for lamb from the UK market grows. He said: "While prices this year haven’t quite reached the same levels of 2012, this is still a welcome boost for Welsh farmers, who have been hit by rising production costs."
Despite the industry lagging behind YOY figures, this year’s lamb crop prices have been strong, and farmers have recently received an average of 303p/kg for new season lamb in the week ending 23 March.
"These prices are a result of strong demand and tight supply of new-season lamb to the market due to the early Easter, reduced lamb crops due to last year’s poor weather and the impact of diseases such as liver fluke and the Schmallenberg virus," Richards added.
Several other factors have also contributed to the rise in lamb prices these last few weeks, including an increased demand for Welsh lamb from overseas and a more favourable exchange rate.
Richards concluded: "Since the turn of the year the euro-sterling exchange rate has fluctuated greatly and, in the last month, the euro has strengthened against the pound.
"This strengthening of the euro has encouraged exports and is a contributory factor for the improved market prices, and the exchange rate will continue to have an impact on prices in the coming weeks as the final lambs from the 2012 crop come onto the market."