Producer share of retail price falls during October

The producer share of retail prices, for both beef and lamb, declined month-on-month during October.

In October, share of retail prices received by sheep meat producers fell four percentage points to 45.8%, the lowest share since November 2015. The measure has now recorded four consecutive months of declines. Compared to the same month last year there is a two point difference. The average farmgate price fell by 3% during October month-on-month, while the average retail price grew slightly, by 1%.

Retail demand for lamb has struggled all year with retail lamb sales declining by 4% in the 12 weeks ending 8 October compared to the same period last year, according to the latest data from Kantar Worldpanel. However, due to the retail price increases total spend during the periods were stable. Although production was lower during September year-on-year, the drop in producer share might suggest that demand is comfortably being met by supply.

Farmgate to retail price share lamb

During October, beef producers share of the retail price fell by 2 percentage point mon-on-month, to 52%. Compared to the same month last year, the measure is just over half a percentage point higher this year. The average retail price during October fell by 1%, while the average farmgate price fell by 3% month-on-month.

Farmgate to retail price share

Retail sales of beef have remained stable in the 12 week period ending 8 October, according to the latest data from Kantar Worldpanel; a 4% rise in the average price caused total spend to rise. Pork has continued on the trend recorded over the past few months with volumes sold increasing despite an increase in pork retail prices.

With Christmas now approaching, many retailers have started their Christmas marketing campaigns, whether this helps retail volumes beef and lamb increase shall be seen over the coming months.

Rebecca Oborne AHDB