Supermarket dominance is ruining the UK sheep market and depressing lamb prices worldwide, says Peter Morris, chief executive of the National Sheep Association.

He said the power of the supermarkets was frightening.

“A market should be driven by supply and demand and free from manipulation.”

Selling at less than 1/kg was not sustainable, but low prices were not due to lack of demand, said Mr Morris.

“There is growing demand for sheepmeat, so why is that not reflected in acceptable prices?”

As big supermarket-led processors increased throughput to cut costs, they increased the amount of cheap lamb available to export.

“Suddenly the sheep industry finds itself in a position where supermarkets not only control the price for the product they sell, but also the New Zealand price, the price of lamb for the food service sector and the price of UK lamb exported on to the Continent.”