Factories and retailers ‘pocketing extra margin’ on lamb – IFA survey

Retailers are charging consumers prices ranging from €8.69/kg to €15.16/kg for the main lamb cuts – while the farmer price has fallen from €5.70/kg to €5.10/kg in the last four weeks, according to the Irish Farmers’ Association (IFA).

The organisation made the claims based on an IFA survey into the main supermarkets in Ireland.

IFA national sheep chairman Sean Dennehy said farmer prices are down 50c to 70c/kg on this time last year – equating to €15 per lamb – while retail prices are more or less the same as last year at 1.3% lower (13c/kg).

Kantar data shows that the average retail price of lamb is €10.09/kg for the last year, the chairman said.

However, with the farmer price down 50c to 70c/kg, processors and retailers are pocketing this extra margin on the backs of farmers, he claimed.

For a 21.5kg lamb carcase with a 79% saleable meat yield at an average retail price of €10.09/kg retailers will charge consumers €171.37, while the farmer only gets €109 for the same lamb.

This is a massive mark-up of 57% on the farmer price, before the fifth quarter for the factory and the retailer, Dennehy said.

Stressing that farmers can’t take any more price cuts, he called on the factories to stop cutting lamb prices and undermining the market.

Retailers were also urged to review their pricing policies and return a fairer share of the retail price to the farmer who does the vast majority of the work in the supply chain.