The latest market information update released by the European Commission shows EU sheepmeat production remaining under pressure, with volumes produced falling by 5.9%, or some 25,719t, on the corresponding period in 2022.

As detailed in Figure 1, sheepmeat production in the main sheep-producing countries in the EU continues to decrease and exceed reduction forecasts.

Spain, which is now the largest sheepmeat producer in the EU since Brexit, has seen production fall by 9.5% to 89,600t, while productions in Romania and France fell by upwards of 8% to in the region of 64,000t.

Ireland is only one of three significant sheepmeat producers to record increased output, with production up to October 2023 running 2.3% higher at 57,700t.

The Netherlands is bucking the trend, with production running 15.7% higher, but from a low production base of just over 15.3t.

Production outside of the countries featured in Figure 1 is small, with just 13,800t produced between the remainder of EU nations.

Higher demand

The cut in production explains the keen demand witnessed in recent months in continental EU markets.

As reported in this week’s paper, Britain has redirected a significant volume of sheepmeat away from the Irish market in recent months and to high-value EU markets.

The strength of performance in these markets is reflected in the latest Bord Bia sheepmeat dashboard.

The average French lamb price for the week ending 23 December 2023 was recorded at €8.91/kg, representing an increase in price of 34c/kg on the corresponding period in 2022 and a 85c/kg rise on 2021.

Spanish prices of €8.94/kg are running marginally ahead of French lamb prices and over €1/kg higher year on year.

British lamb prices are 60c/kg higher, while, in sharp contrast, Irish lamb prices averaging €6.46/kg were running 1c/kg higher.

The differential between lamb prices in Britain and Northern Ireland remains significant at over 55c/kg.

While on the subject of price, it is worth noting that Australian lamb prices have finally recorded upward movement and stood at €3.79/kg at the end of the year.

This is almost 80c/kg higher than the previous months and positions Australian lamb prices ahead of the New Zealand average of €3.54/kg.