Tighter lamb supplies expected to support prices through 2027

Falling sheepmeat production across the UK and Europe is expected to support lamb prices throughout 2027, despite weaker consumer demand and short-term pressure from seasonal supplies.

The latest Outlook report from the AHDB forecasts UK sheepmeat production will fall by 2.4% in 2027 to 262,000t, as lower slaughter numbers and a contracting breeding flock reduced domestic supplies.

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Across the EU, sheepmeat production fell by 2% year-on-year in the first half of 2026, with output down by about 3,000t. Declines in major producing countries, particularly Spain, Greece and Ireland, outweighed increases in France and Italy.

However, the GB lamb market experienced short-term supply pressure over the summer as seasonal supplies increased and demand weakened.

Prices bottomed out at about 705p/kg deadweight for Standard Quality Quotation carcasses in late August, but have been gradually recovering since to 723.7p/kg dw on 10 October.

Live trade

Peter Ovens, of Bagshaws in Uttoxeter, Staffordshire, said numbers coming forward had remained strong into the autumn, while demand had slipped, particularly for lower-quality, grass-fed lambs.

“Demand has eased, certainly on the second quality, more grass-fed types, significantly more than the better end,” he said.

However, trade has improved for some categories, with export-weight lambs and heavier animals attracting stronger prices at Shrewsbury Auction Centre this week.

Tom Jerman, auctioneer at the centre, said export-weight lambs had made 330-340p/kg liveweight, while trade for lambs weighing more than 45-48kg had recovered to 310-320p/kg after falling sharply a fortnight earlier.

“Well-bred lambs are making a premium and all types and grades are selling well,” he said. “Meatier lambs and quality-bred lambs are at a premium at the moment.”

Mr Jerman said store lamb buyers and those purchasing hoggets for Christmas had also helped support the market, with further seasonal demand expected to benefit prices.

“We saw demand from Portugal for lambs under 40kg last season, which pushed up prices, so we are hoping to see a repeat of that this year.”

He added that lamb numbers had fallen noticeably compared with five years earlier, although prices continued to fluctuate daily.

Mr Ovens also warned that strong store lamb prices could encourage producers to retain animals for further finishing rather than selling them for slaughter, potentially increasing the number of heavier lambs available later.

Outlook

Despite these short-term market pressures, the AHDB expects tighter supplies across the UK, EU and southern hemisphere to outweigh any weaker consumer demand, supporting firm GB lamb prices through 2027.

David Swales, AHDB head of economics and analysis, said tight cattle and sheep numbers were expected to underpin prices over the forecast period.

“While we expect consumer demand to remain under pressure, reduced production in both the UK and key competitor regions is helping to support market fundamentals,” he said.

However, he warned that businesses would need to monitor risks including bluetongue, changing trade dynamics and ongoing cost pressures.

Meanwhile, strong EU import demand was expected to support UK exports, although declining domestic production could limit opportunities for further growth.