Autumn lamb slump brings gloom

By FWi staff

MANY sheep producers probably want to forget the second half of 1998, plagued as they were by a price slump caused by an oversupplied market and a drop in demand.

Current liveweight prices of 60-65p/kg are 35% lower than this time last year, and less than half those seen in 1996.

Many in the industry say the situation will get worse before it gets better.

“I cant see a light at the end of the tunnel,” said auctioneer Andrew Thomas of Thame market.

Its a far cry from the start of the season when the supply of lambs was steady and prices were reasonable.

Even in August, lambs were fetching more than 100p/kg.

But a glut of lambs entering the market this autumn saw a rapid decline and returns had fallen to 54.0p/kg by mid-November.

A number of factors contributed to the down turn in the market, perhaps the biggest being the loss of the skin market caused by economic turmoil in Russia.

Lamb trends, 1998

As the value of the Rouble plummeted, skin values fell from a high of £10 each to a mere £1.

Weak export markets, a high Pound and bad weather at home all exacerbated the situation.

Finishing was delayed and many lambs were either slow to enter the market or were of poor quality.

On the domestic front, plentiful supplies of pork and beef at relatively low prices helped to drive down lamb prices even further.

But despite all this, sheep exports are up by almost 100,000 on last year and, despite a general lack of enthusiasm, some people are looking on the bright side.

Morale is still good under the circumstances, said auctioneer Alan Venner of Exeter market.

“I remember a time when we could accurately forecast the future, but we havent got a clue whats going to happen anymore.”

Mr Venner said producers should try and remain optimistic.

“There are always blips in the sheep trade every few years and hopefully this year is just one of them,” he said.

See more