Lamb sales grow in mid-June

Lambs saw a strong week during the Royal Highland Show (15-21 June).

According to data from Quality Meat Scotland, there was a significant lift in the number of lambs sold throughout Great Britain, with Scottish auctions selling 60% more lambs than the previous week and one-third more than the same week in 2014. Across Great Britain as a whole, 15% more new-season lambs were sold than in the same week last year.

However, this increase in sales has coincided with a dip in lamb prices of around 20p/kg/lw, while retailer prices for lamb cuts during June are around 5% lower than last year.

Between May and the middle of June around 2% more lambs have reached the GB market, consistent with the reported increase in breeding sheep numbers shown in the December 2014 census.

QMS head of economics services Stuart Ashworth said there were two key factors that have been influencing the volume of lambs reaching the market in 2015 grass and lamb growth rates and the start of a religious festival.

The influence of this seasons grass and lamb growth is reflected in a higher volume of new-season lambs sold in May compared to year earlier levels, followed by a slowdown in numbers at the start of June, he said. Ramadan is an important Muslim festival that moves forward in the calendar by a fortnight each year. There is some evidence, looking at the past few years, to suggest that it supports prices until it begins but then prices come under pressure, although there can be a short-lived lift in the final week of Ramadan.

Ashworth added that global producer prices have come under pressure. French and Irish producers are currently receiving around 6% less than last year and Spain has also seen steep falls in heavy lamb prices, while their light lambs are trading around 6% lower than last year.

The current New Zealand producer price is around 15% lower in national currency and has fallen further when quoted in sterling.

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