Sheep trade: Processors warn of cuts of up to €13/head for hoggets and €8/head for spring lambs

The recent upturn in prices for sheepmeat looks to have come to a halt, as base prices for both spring lambs and hoggets head in the wrong direction.

As of Monday, April 27, both Kildare Chilling and Irish Country Meats (ICM) wiped 20c/kg and 10c/kg off their base prices for spring lambs respectively; however, worryingly, this is expected to increase further throughout the week.

Furthermore, in terms of hoggets, both processors (Kildare Chilling and ICM) knocked 20c/kg respectively off their base quotes (for hoggets) from last week.

On Monday, April 27, Kepak Athleague was not for quoting spring lambs, hoggets and cast ewes.

As of tomorrow, Tuesday, April 28, a further 30c/kg and 40c/kg are, reportedly, expected to be wiped off base quotes for spring lambs and hoggets respectively, which represents a huge drop in prices in less than a week.

In total, compared to this time last week, up to 40c/kg and 70c/kg are expected to be knocked off base prices for both spring lambs and hoggets respectively by tomorrow.

Reports from processors are suggesting that the demand isn’t there for sheepmeat, with meat processing facilities struggling to move on what supplies they have currently.

The same can be said for hoggets; if base prices drop to what is being reported, then losses of up to €13/head could be on the horizon compared to this time last week.

This will be worrying news for farmers, considering the Ramadan season only kicked off last week. The hope among farmers was that prices would have remained at least at what they were last week for a sustained period of time.

However, with the European Union making Aids to Private Storage (APS) available for sheepmeat in the coming weeks, is it such a shock that prices are going to take a hit?

Covid-19 seems to be taking its toll on some meat processing facilities, with normal production expected to be disrupted significantly over the coming week.

So, having seen a rapid recovery in terms of prices over the last few weeks, it looks like – as it first was when Covid-19 initially struck Ireland – that prices are heading in the wrong direction once again.

Quotes

Taking a look at the quotes on offer, ICM (Monday quote) is offering a base price of 630c/kg – up to a carcass weight of 20kg – for spring lambs.

Whereas, Kildare Chilling (Monday quote) is offering a base price of 640c/kg for spring lambs up to a carcass weight of 20kg.

When quality assurance (QA) bonuses are factored in, this leaves quotes at 640-650c/kg for spring lambs.

Taking a look at the quotes for hoggets, ICM (Monday quote) is offering a base price of 590c/kg, while Kildare Chilling (Monday quote) is offering a base price of 600c/kg.

Turning to the cast ewe quotes, no change is expected, with base quotes at the 270c/kg mark. When QA is taken into account, prices of up 280c/kg are achievable.

Throughput

During the week ending April 19, the number of hoggets processed decreased by 11,346 head and amounted to 30,415 head.

Furthermore, the number of spring lambs processed amounted to 4,797 for the week ending April 19.

Cast (ewe and ram) supplies at the Department of Agriculture approved sheep export plants stood at 4,439 head – an increase of 1,379 head – for the week ending April 19.

Moreover, overall supplies decreased by 10,505 head during the week ending April 19 and amounted to 39,651 head.

Cumulative figures for the year to date have reached 782,669 head, which is an increase of over 61,749 head compared to the 2019 figure of 720,920 head.