Declan Fennell, Sheepmeat Sector Manager, Bord Bia – Irish Food Board

With some 70% of our sheep meat production destined for the export market understanding the factors that control the global supply-and-demand balance (currency movement, economic conditions, religious festivals and variations in production cycles) is of critical importance in determining farm gate prices and export returns.

2015 will go down on record as another successful year for the Irish sheep meat industry where values rose by 5% to an estimated €230 million and average farm gate returns at €4.83/kg were some 12 cent above the five year average. So what were the key factors that influenced the performance of the Irish sheep sector in 2015?

1. Currency movement: Throughout 2015 sterling strengthened against the euro. At its weakest point the euro was trading shy of the 70 pence mark, some 10 pence less than what it was achieving in in equivalent period in 2014. With over 90% of UK sheep meat exports destined for the Eurozone region a weak euro reduced the competiveness of UK sheep meat exports. This in turn gave Irish exporters a significant market advantage.

2. Supply matching demand: Ensuring an orderly supply of sheep meat to match the demands of the marketplace is a delicate balancing act. Looking back over 2015 throughputs patterns, the average weekly kill stood at 50,000 head and whilst it peaked at 59,000 head in the period June – October, at no stage during that period did farm gate prices experience any significant downward pressure.

3. Adding value: Irish sheep meat exporters have been relentless in their drive to broaden and diversify their product portfolio by shifting away from trading in carcases towards developing more value added / primal products. Emerging opportunities in the high value markets and working directly with key retail and foodservice accounts has enabled the Irish industry to seek out the best paying customers.

For more information please contact Declan.fennell@bordbia.ie