Meat processors must bring more structure and profitability to the supply chain the Ulster Farmers’ Union has claimed as new season lamb prices fall below the cost of production for the third consecutive year.
“Processors have been trying to buy spring lambs around the 470p/kg mark over the past week,” said UFU beef and lamb chairman, Crosby Cleland.
“This is far short of producer expectations. Early lamb is a high cost system and realistically farmers need a steady price of around 540p/kg to cover their costs and leave something for their own labour and future investment,” says Mr Cleland.
Mr Cleland, a Co Down sheep farmer, said three consecutive years of prices below production costs was an unsustainable position for the indsutry.
In an additional blow he said some sheep producers had also been told by processors that their lambs are not wanted by the market.
“This is a major setback for farmers who have put in a lot of hard work to produce high quality early lamb,” he said.
“It shows a lack of joined up thinking in the supply chain that there are not clear signals coming from the market about when processors are ready to switch from hoggets to new season lamb.”
With Brexit a major focus for the sheep industry, given Northern Ireland’s reliance on exports, Mr Cleland said the current position should also be treated as an opportunity to discuss existing production systems and how the industry can become more market focused and profitable.
“Processors, and the rest of the supply chain, must be clear on what exactly they want, when they want it and be prepared to pay a fair price.
“For now, farmers are receiving too many mixed messages.”