Lamb prices at marts across Britain were at a three year high last month, according to EBLEX.
It says last despite prices being back around 5p on the week overall, lambs last month were trading at their highest level in three years.
EBLEX says the modest easing of the trade last week is on the back of more lambs coming forward again this week, compared with a week earlier.
However, with inclement weather arriving in some regions, there is the possibility of some movement disruptions which may affect trade.
While trade appears to be remaining firm, there has been a drift downwards as the week progressed.
Having started the week at 187p/kg, the SQQ fell to 182p/kg by Wednesday 28 and Thursday’s trade looks set to be continuing this trend.
Currency impact
The relentless rise of sterling maybe starting to impact on the market, according to EBLEX.
It says the pound has hit a seven year high against the euro in the last few days.
Sterling had already been appreciating slowly but steadily since July 2013 but now, with the Eurozone once more on the brink of recession and growing fears about Greece leaving the Single Currency, it has moved up even further.
By 27 January, sterling had appreciated to €1.34 compared with €1.28 at the start of the year and €1.16 in July 2013.
According to EBLEX this inevitably reduces the price competitiveness of UK sheep meat exports to other EU markets.
Irish Trade
The lamb trade here in Ireland is also set to remain strong this week.
According to the IFA’s latest lamb price update factories are paying €5.50/kg for lambs this week.
It says supplies are scarce and some farmers are getting top prices of €5.55/kg – €5.60 kg while ewes prices are ranging from €3.30/kg to €3.50/kg.
Bord Bia says last week the sheep trade continued to remain strong on the back of solid demand coupled with some further tightening in supplies.
However, it says the trade was mixed across our key export markets.
Supplies at sheep export meat plants for the week ending January 24 stood at around 39,000 head which was 7% lower than the corresponding week in 2014. Cumulative supplies for the year to date are currently 1% behind year previous levels.