Lamb price differential ‘unacceptable’

UFU Deputy President Ivor Ferguson congratulates Ian Duff on his recent appointment as campaign co-ordinator for the potato sector.
UFU Deputy President Ivor Ferguson congratulates Ian Duff on his recent appointment as campaign co-ordinator for the potato sector.

The Ulster Farmers’ Union has said that local processors have devised a new price differential.

Following a meeting with the NI Meat Exporters, the Union described the recent collapse in sheep prices as ‘unacceptable’.

UFU deputy president Ivor Ferguson said that over the last five weeks producers have seen prices for hoggets and spring lambs crash by up to 25%.

He added: “While it has been well documented that there are a multitude of reasons for the downturn in the sheep trade across the UK and Ireland, Northern Ireland has been the worst affected region in the British Isles.

“Today’s price of £3.30 for hoggets and £3.70 for spring lambs is simply unworkable and will leave all producers in a loss making situation after incurring significant production costs through the winter and spring,” he added.

“We have not seen spring prices this poor since 2009 but when you consider that prices in the rest of the UK and ROI are still in the region of 30-60p/kg higher than Northern Ireland, something clearly does not add up. Northern Irish processors are by in large operating in the same markets as both the GB and ROI plants so there is absolutely no reason why they cannot pay a higher price to bring us in line with neighbouring regions.”

Mr Ferguson continued: “Livestock farmers are very familiar with the price differential that has existed for beef compared to the rest of GB but now we are seeing local processors taking full advantage of uncertainties in the market place and a reduction in cross border trade by devising a new price differential for lamb which is severely penalising local sheep farmers.

“This makes it all the more important that Minister O’Neill is able to find a resolution with the ROI government to the labelling issues so that cross border trade can return to normal levels. The lack of competition over the last number of weeks for sheep demonstrates how processors will take advantage of local farmers and Minister O’Neill must not allow this to happen.”

He concluded: “I would also appeal to farmers to make sure that they market new season lambs which are in spec and no heavier than 21kgs. Part of the problem this spring has been that there have been too many overweight hoggets in the market and these out of spec carcases are more difficult to sell.

“Farmers must be disciplined and sell lambs when they are ready at 21kgs. Heavier lambs will only put additional meat into the market and will ultimately put more pressure on prices.

The National Sheep Association (NSA) has said there are many factors contributing to the depressed lamb price seen in recent weeks.

Phil Stocker, NSA chief executive, said: “There are several factors contributing to the current situation: the strength of the pound; the economic situation on the continent; an increased New Zealand offering on our supermarket shelves; farmers in some regions lambing earlier in 2015, assisted by dry weather allowing them to sell new season lamb sooner; and a larger carry-over of old season lambs from 2014.

“While this has created an unfortunate ‘perfect storm’ to push the lamb price down, it also means that the sheep sector should not lose heart, as it would only take one or two factors to change for there to be an uplift in the price.”

NSA Northern Ireland region development officer Edward Adamson added: “In Northern Ireland we have the added problem of long-awaited EU labelling rules being implemented in the Republic of Ireland since 1st April. The requirement for NI lambs to carry a UK origin mark has caused a large reduction in numbers of lambs going south, creating less demand and further price drops for us. The plants in the South of Ireland took 45% of NI slaughter lambs last year and we need them to stay in business, so we hope the problem can be resolved. There is some support for a voluntary label saying ‘Produced in NI and processed in the Republic of Ireland’ but we need both regions to support and get agreement on this.”