Irish Lamb Prices Falling Sharply Toward End of June; Inflation Pressuring Consumer Demand

Published 2022년 6월 30일

Lamb prices have been considerably cut by processors from the record highs in mid-June, citing slower demand. However, it is still early to know if prices have already peaked.

Irish lamb carcass prices, which were still edging up to record highs in mid-June, have been reported to be declining rapidly since then. According to Agriland, prices by a processor, which were at EUR 8.20/kg on June 15, were cut by EUR 20c/kg on June 17, and a further EUR 50c/kg on June 23. This represents a decline of roughly 9% in a week. Processors have been cutting prices as sales have been reportedly slowing down. It seems inflation, which is at multi-decade highs in Ireland, is now taking a toll on consumer demand.

However, it is still early to know if mid June prices represented a peak, as there’s bullish factors to take into account: Farmers are reportedly pressuring for higher prices, as input costs remain elevated and secondly, the Eid Al-Adha celebrations are set to start in early July, boosting demand.

Average heavy lamb carcass prices in Ireland had reached a record high of EUR 8.00/kg during the week starting June 13, according to European Commission data. Among four of the five largest producers, Spain, France, Ireland and Romania (there is no reported price data for Greece), Irish prices were trading at the highest levels. In Spain, prices had peaked in December 2021, although they have been consistently rising since mid-May 2022. Meanwhile, prices peaked in France in early May 2022, and are now trading 2% below. In Romania, prices peaked in mid-April 2022 and are now trading 36% below.

Source: Tridge and European Commission

It’s worth noting that in Northern Ireland and the rest of Great Britain, liveweight and deadweight prices have also been reported falling in late June. Processors in Ireland also import live sheep from the North to slaughter. In the week ending June 25, Northern Ireland liveweight prices stood at EUR 6.49/kg (-11%) WoW, while deadweight prices stood at EUR 7.15/kg (-5.5%) WoW. In the same week, Great Britain deadweight prices stood at EUR 7.53/kg (-2.4%) WoW.

Meanwhile, according to data from Bord Bia, overall sheep processing in Ireland, from the beginning of the year up to the week ending June 18, is up (+14%) YoY, at 1.26 million head. In terms of carcass weight, Ireland’s production was up (+16.5%) YoY in Q1 2022, compared to declines of (-8%) YoY in France and (-3%) YoY in Spain in the same period.

As of 2021, Ireland was the fifth largest sheep processor among the EU 27 members, with a total sheep slaughter of 2.974 million head, representing 8% of total EU 27 production. Also in 2021, Ireland was the fourth largest sheep and goat meat exporter in the world, behind New Zealand, Australia and Great Britain. In Jan-Apr 2022, Ireland had exported sheep meat $157 million in value, which represents an increase of 23% YoY.