Supply and demand indicators for lamb in the UK market are continuing to puzzle traders, as the slaughterings and price data do not clearly confirm either of the conflicting forecasts that the industry was hearing from the pundits a few months ago.
Some analysts predicted a market collapse, believing many producers would quit in despair at the new single payment subsidy system and the consequent avalanche of cull ewes would drive down prices, though this would be followed by a shortage of prime lambs.
Latest auction market numbers show instead an almost normal seasonal pattern. Although ewe culling has increased, prime stock supply is slightly heavier than 12 months ago and ringside bidding by farmers for some animals in at least some parts of the country suggests confidence in maintaining output next year.
On the other hand, the average liveweight price of about 105p per kg for good quality lambs is a shade weaker than optimists had forecast.