UK deadweight lamb market buoyant

UK deadweight lamb prices have continued to climb, making substantial gains in the week ending 27 May.

Old season lamb prices hit 463.7p/kg, a 13.8p increase on the previous week, while spring lambs rose by 17.7p to end the week at 498.3p/kg, according to AHDB Beef & Lamb.

This took the deadweight sheep total average price to 69p/kg above the level seen 12 months ago, an increase of 16.1% and the largest the gap has been for 10 months, according to the levy board.

See also: Lacklustre lamb demand over Easter period

Old season deadweight lamb prices lifted by 14% (57.2p/kg) in the four weeks of May, with new season animal prices up 5% (23.4p/kg) over the same period.

Rising demand for lamb has pushed prices towards the £5/kg mark, largely driven by the dwindling numbers of hoggets still available.

Estimated slaughter numbers continued to lose ground on last year at 195,300, 13% down on the same week 12 months ago.

Liveweight falls

In the meantime, liveweight lamb prices moved in the opposite direction in the week ending 31 May, bringing four consecutive weeks of rises to an end.

The GB SQQ old season lamb (OSL) fell by 7.9p to 186.5p/kg while the GB SQQ new season lamb (NSL) price dropped by 7.2p to 238.1p/kg.

Despite the falls, prices remained 4.7% and 8.9% up compared with the first week of May, for old and new season lamb respectively.

Spring lamb prices remained 17% higher than they were in the same week in 2016, a gap of 36p/kg.

Total numbers coming through markets were 19% down on the previous week to 99,600.

The lack of available hoggets and many spring lambs needing further finishing were drivers of this decrease according to the levy board.  

UK lamb export competitiveness

Strong farmgate prices have coincided with a positive outlook for UK lamb exports.

UK lamb prices achieved virtual parity with Irish product this spring, on the back of further falls in the value of the pound alongside challenging conditions for Irish producers, said AHDB Beef & Lamb.

The UK lamb competes with its Irish counterparts over a number of key European markets, and the vast reduction in the traditional premium of UK product has made it an attractive prospect.

In 2016 this premium averaged €330/t but has been beneath €100/t for all but two weeks since March 2017.

The levy board said the two prices have not been in a comparable position for almost a decade.  

However, AHDB Beef & Lamb predicts UK lamb exports will see only modest increases export volumes across the remainder of 2017.

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