Market report: Lamb price rises hitting retail sales

Lamb prices are becoming increasingly fragile, as British consumers are buying less in the face of higher prices.

Deadweight values have risen sharply over the past five weeks, from 313.5p/kg for R3L SQQ carcasses, to 359.1p/kg in the week ending 28 November, some 82p/kg above the same period last year.

Strong demand and falling supplies are behind the rising market, with retail values up by 5% in the 12 weeks to the start of November. However, this price rise led to an 8% fall in sales, resulting in a 3% drop in expenditure against the same period last year, says the latest bulletin from Northern Ireland’s Livestock and Meat Commission.

“With this in mind, ongoing increases in the retail price have the potential to reduce the overall value of the lamb market.” Fortunately, the gap between farmgate and retail prices narrowed from 55% in July to 52% in September, yielding a greater share of returns to producers. “But with consumers so responsive to changes in price, producers have to target improvements in efficiency and maximising returns from the retail price, rather than increases in the price paid by consumers,” it said.