UK Lamb Prices Surge Amidst Perfect Storm
The price of British lamb has skyrocketed to unprecedented levels due to a convergence of factors, including adverse weather conditions, disease outbreaks, import challenges, and surging demand.
Market Dynamics:
Wholesale prices for British lamb have surged by over 40% year-on-year, exceeding £8.50 per kg. This surge coincides with a forecasted 1.4% decrease in lamb production in the UK for the current year, as reported by the Agriculture and Horticulture Development Board (AHDB). The demand for lamb in the UK has seen an 8% increase in the past three months, particularly following Easter and Eid celebrations, where lamb is a traditional centerpiece dish. Additionally, competition for local lamb has intensified with high demand from overseas buyers, notably in France.
Challenges Faced:
David Swales, head of economic analysis at AHDB, describes the current market conditions as unprecedented. Cold and wet weather conditions have led to higher lamb mortality rates, while concerns mount over the impact of the Schmallenberg virus affecting regions in the south of England, Wales, and the Midlands.
International Competition:
While British lamb prices soar, its main competitor, New Zealand lamb, has experienced a contrasting trend, with prices falling by approximately a fifth year-on-year to less than £3 per kg. This decline is attributed to increased global supply from Australia and weak orders from China. Furthermore, new trade deals have facilitated the import of Australian and New Zealand lamb into the UK by removing tariffs on larger quantities of meat. However, delays in shipments caused by attacks on Red Sea cargo ships by Yemen-based militants have tempered the expected surge in imports.
Supermarket Responses:
Morrisons, one of the UK’s leading supermarkets, has announced a departure from its seven-year commitment to selling 100% British lamb. In a move to address consumer demand for more affordable lamb options, Morrisons plans to trial the sale of New Zealand lamb in 39 stores. While other supermarkets may face pressure to follow suit, Waitrose, Marks & Spencer, and the Co-op have affirmed their commitment to sourcing 100% British lamb.
Industry Reactions:
The National Farmers' Union (NFU) has expressed disappointment over the potential shift towards imported lamb, citing concerns about food miles and production standards. Phil Stocker, the chief executive of the National Sheep Association (NSA), criticized the timing of Morrisons' announcement alongside Rishi Sunak’s Farm to Fork Summit, emphasizing the negative implications for UK agriculture.
