Trade Talk - Richard Hyde

25th November 2015

Being asked to write the ‘trade talk’ in the face of the current lamb trade is something of an onerous task, but there are positives in the sheep world and one has to see past the present trade and take economic comfort from other parts of the sheep business, which are so positive. Countrywide every farmer must be pleased with the Cull Ewe trade that has been experienced throughout 2014 and 2015. The Cull Ewe has become a hugely important factor in sheep farming income and instead of being a ‘by-product’ of the industry they have now become a huge and significant part of the income. At Hereford last week we had the largest entry ever at 3,839 Cull Ewes sold at an average of £62.37, whereas 3,058 prime lambs, with very few smalls averaged £60.14. Cull Ewes are  virtually all  consumed within GB and therefore currency fluctuations etc have very little effect and probably more importantly the Cull Ewe market is in the hands of independent outlets rather than National conglomerates, who control the internal lamb trade.

 From the beginning of 2015 the sale of In-Lamb Ewes, followed by Ewes with Lambs at Foot was exceedingly buoyant. These trades continued well and now the Breeding Ewe and Store Lamb trades have opened to very strong prices with Yearling Ewes well into the £130’s and forward Store Lambs well into the £50’s.

 I have been waiting for at least 20 years for food in general to become a more valued commodity. We are constantly told that the rising world population has got to be fed and watered to prevent instability, nothing frightens a Government more than a hungry population. Here are some world food production figures which you may find interesting: 

Pig Meat - 120m Tonnes

Poultry Meat - 112m Tonnes

Beef Meat -  70m Tonnes

Sheep Meat -  14m Tonnes

Wheat - 720m Tonnes

Rice - 500m Tonnes

The Chinese and Indian population combined totals 2.5billion people, 40% of the World’s population. If each one of those souls eats 11b extra each per year, that is 1.11m Tonnes. 1lb extra per month, a very small forkful per day, equates to 13.3m Tonnes; virtually the whole of the worlds sheep meat production. To my mind these figures show how finely balanced supply and demand are in the face of increased demand from developing nations. I trust that this may give some comfort to producers looking at the current lamb trade!

Richard Hyde

Hereford Market Auctioneers Ltd