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Coping with low lamb prices

15th January 2013

The lamb price is at its lowest point since 2009 at an avg of 128p/kg LW, 25% lower than 12 months ago. Whilst these prices are very disappointing and when we got used to better prices in recent years it is not surprising. After a decade of contraction the sheep sector has seen a 2% expansion in breeding ewe numbers in the last 18 months. The combination of increased lamb numbers and the terrible weather reducing growth rates along with the high cereal prices putting producers off from creep feeding lambs has resulted in a glut of late finished lambs. This is on top of reduced domestic demand due to high supermarket prices and the big buyers going abroad to find cheaper supplies. We can’t control the weather or the supermarkets unfortunately but we can control the ‘nuts and bolts’ of our own businesses. We work with many flocks to trim out the unnecessary costs which drain your profit margin. It is essential to take a step back and look at how you set up your business and question everything! The flocks who thrive even at the current market prices have low fixed costs and set targets for production. With our help they know how much it costs to produce each Kilo of lamb and how many Kilo produced per acre and CRITICALLY we work together to get their costs down and their production up. We work with several low input lowland flocks with breakeven costs of 63pKgLW compared to the average breakeven cost of lowland flocks of 230pKgLW due to a combination of lower fixed costs and higher production per ewe. We are happy to have a chat about your system and how we can help no matter how big or small your flock is. More than half our clients are rapidly expanding flocks and big ambitions for their businesses who come to us to help set their system up as efficiently as possible and allow them to expand more easily. It is great working with young farmers who have a real desire to do things right and use the latest research and technology to its full potential.

 

 
 

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