By Tim Relf
SHEEP prices have rallied in recent weeks, despite the lack of response to the private storage aid scheme.
The scheme, introduced by Brussels in a bid to prop up the market, had attracted no response from GB traders as last Wednesdays (March 25) closing date passed. In Northern Ireland and the Irish Republic, 113t and 20t, respectively, had been covered.
Concerns over the end use of stored meat discouraged use of the scheme, said Duncan Sinclair of the Meat and Livestock Commission.
Chief executive of the ANM group, Brian Pack, said: “There are easier ways of losing money in the meat business than trying to sell frozen hoggets in July.” The compensation was worth £19 a lamb, but current buying prices plus costs of £6 per hogget would demand a selling-out price of more than £30 in July, said Mr Pack. “I cannot see that, being realistic. And I am also reasonably confident that most of the backlog of hoggets has been cleared.”
Any effects of the PSA were small and short-lived, said John Kearns of south west abattoir Lloyd Maunder. It had an indirect effect, though, prompting farmers to delay selling sheep anticipating a price rise – which, in itself, boosted open market values. But when more sheep came on to the market, prices fell again.
The strength of Sterling remains the number one issue for Mr Kearns. The &Pound was worth FF10.37 on Monday (March 30).
NFU livestock committee adviser Dafydd Owen said the applications to PSA, accounting for the equivalent of about 7000 sheep from Northern and Southern Ireland, were “not insignificant”.
But the real factor driving the trade up has been the disappearance of the backlog which built up as farmers postponed selling sheep at the end of last year.
“The bulge has been cleared, which is good news,” said Mr Owen. “We seem to have put the worst of the depressed market behind us.”
Auctioneer Rob Meadmore at Hay-on-Wye said the recent rally in prices encouraged bigger marketings. “There were tegs out there, waiting for the trade. A lot of sheep have now been sold for £40 or more – which is a lot better than what they were worth.”
The outlook remains good for the best, said Mr Meadmore. But with the end of the hogget season in sight, too many are being offered under-finished as producers rush them to market, he added.