Rush to sell in Highland Show week hits Scots lamb producers’ wallets
A HIGHER number of lambs in the country and a sudden push to get them to the market during Highland Show week saw a substantial drop in producer prices over the course of that week.
According to Quality Meat Scotland (QMS), there was a 60 per cent jump in the sale of Scottish lambs compared with the previous week. This figure was more than 30 per cent higher than the same week last year – and more than double that marketed in the same period in 2013.
The glut, combined with a rise in marketings across the rest of the UK, had seen prices fall by 20p per kilo over the course of a week.
Seeking to explain the background, head of economics with QMS, Stuart Ashworth, said that while the most striking aspect of Scottish and overall UK lamb marketings had been the substantial increase in lambs sold during the Royal Highland Show week this had come on top of greater volumes forward across the course of the season.
He said that 2 per cent more lambs had been marketed between May and the middle of June – a figure which was consistent with the reported increase in breeding sheep numbers. However, he said that this increase had not been fed onto the market consistently, with numbers forward varying greatly between weeks.
Ashworth said there had been two key factors influencing both the volume of lambs reaching the market and demand in 2015: grass and lamb growth rates and the start of a Muslim religious festival.
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.”
He said that this year there were indications that demand had not been as strong as expected at the same time as the increase in availability, resulting in a short-term build in meat stocks.
However, he added that the steep fall in the price over the past fortnight had slowed the number of lambs presented to the market since.
According to Ashworth, producer prices had also come under pressure around the globe. He said: “French and Irish producers are currently receiving around 6 per cent less than last year and Spain has also seen steep falls in heavy lamb prices, while their light lambs are trading around 6 per cent lower than last year.”
He said that New Zealand producer prices were around 15 per cent lower as well.
He said that New Zealand’s price had come under pressure from a “distinct cooling” of demand from China, which had taken at least one-third less sheepmeat in May than last year.
However, despite the cheaper Kiwi lamb, indications were that there had been little change in the volume of New Zealand lamb sent to the UK in May, although there had been some growth in trade to northern European Union member states and the United States.