The proliferation of lamb marketing schemes backed by the multiples and the increasing confidence of sheep farmers cast doubt on forecasts of a medium to long term contraction of the industry's productive capacity. Estimates just published by MAFF add to the confusion. Until recently it was widely assumed output was a on gentle downtrend, the 1996-98 flock expansion and supply surge having been just a statistical blip attributable to the BSE crisis. MLC's most recent predictions, for instance, were of slight declines in slaughterings this year and next, with the outlook further ahead clouded by uncertainties over EU subsidy policy. MAFF's June flock estimates for England appear to challenge this, showing year on year decreases of less than 1% in the numbers of breeding stock and lambs for slaughter. Viewed in the light of subsequent strong bidding by farmers for breeding and store stock, should these figures be interpreted as evidence of total supply stabilising? On closer inspection, perhaps not. The number of female sheep not yet used for breeding was down heavily, by almost 9%. However, this category is not quite comparable with the maiden gilts' familiar as a barometer of supply intentions in the pig industry. {{MEAT }}