19 December 1997

Nervy sheep trade holds breath while prices slip

By Tim Relf

SHEEP prices continue to fall, with news headlines linking BSE and sheepmeat prompting further nervousness in the trade.

Auctioneer Brian Pile at Banbury saw buyers, rather than risking getting caught with stocks, hold off at the end of last week.

Together with the strong £ sterling which is "crucifying" exports, this led to an average price of about 96p/kg lw in the mart on Thursday. Some lambs are now making £20/head less than they would have 12 months ago, says Mr Pile.

Commentators predict further price pressure in the new year, too, when tighter specified risk materials (SRM) controls apply for sheep of more than 12 months old. "Its an additional cost which will probably finish up on the farmers doorstep," says auctioneer Scott Murray at Oakham, Leics.

The additional measures, says Mr Murray, will have an immediate impact on the cull ewe trade – and could hit the hogget trade later in the spring. Then, a two-tier market could be seen. "Theyll be so much competition – and so much cheap New Zealand lamb – that buyers just wont bother with animals over 12 months of age."

Sheep farmers have also been worried by a statement from an EU committee, advising that SRM control be tightened still further, to include backbone removal.

This proposal would apply to animals over a year-old – although the suggestion that it be six months in high-risk countries has brought widespread criticism, as it would affect more animals.

At Oakham last Friday, about half the sheep went home unsold. "Buyers wanted to wait and see what affect the latest round of bad publicity had in the shops over the weekend," says Mr Murray.

Meanwhile the need to present clean sheep remains paramount, with many "lathered up" after coming off sugar beet tops.

Further downward pressure will also be felt in the coming months as the backlog of animals currently on-farm is marketed. The Meat and Livestock Commission reckons 600,000 head (20%) more could be sold in the first three months of next year than in the corresponding period of 1997.

"A lot of farmers have been left with sheep – now theyre sending them out, come what may," said a spokesman at Bishops Castle mart where last Fridays sale saw an entry of 3200 head, the largest of the season.

Concerned buyers at Grantham on the day EUproposals to remove sheep spines were announced.