Questions are being asked on both sides of the planet about the low retail price of New Zealand lamb in United Kingdom supermarkets.
UK sheep farmers are criticising the Morrisons supermarket chain for selling NZ lamb at cheaper prices than local product, and some NZ farmers are questioning why their lamb is being sold cheaply in the UK or promoted as either NZ or UK product.
Morrisons is trialling NZ lamb in 39 stores and a spokesperson said it is cheaper than the British product.
“The blunt commercial reality is that NZ lamb is cheaper to source, and therefore cheaper to sell, than British lamb,” a spokesperson said.
“We will remain 100% British lamb on all our butchers’ counters, and the NZ lamb will of course be clearly labelled so customers in these trial stores will see the difference and can make a choice.”
In NZ, the Meat Industry Association said NZ lamb is priced more cheaply than British due to UK retailers treating it as a loss leader.
“Ultimately, the retailers set the price of in-store lamb in the UK and they base their decisions on a range of factors including seasonality and demand,” said MIA chief executive Sirma Karapeeva.
“Many retailers promote lamb as a loss leader to bring shoppers into stores to buy other products,” she said.
UK shoppers have traditionally supported domestic farmers by paying premium prices.
Karapeeva said the UK sheep flock has been declining while lamb exports to the European Union and United States are rising, heightening demand and increasing UK lamb prices.
Given NZ’s supply chain costs, Karapeeva said, it is challenging to make direct price comparisons.
The BBC reports that National Farmers Union (NFU) board chair David Barton described the Morrisons move as “disappointing” at a time when the British livestock industry is under pressure, most recently from wet weather.
He said that NZ lamb is “produced to potentially lower standards”, a claim Beef + Lamb NZ roundly rejects.
“NZ upholds high animal welfare and environmental standards, making it an ideal partner for providing safe, nutritious, and high-quality lamb to UK consumers,” said Alex Gowen, BLNZ regional manager, UK & Europe.
“NZ and the UK share common values and a commitment to rigorous production standards and robust regulatory and quality assurance frameworks, so it is really disappointing to see these false claims promoted by the NFU.”
The Morrisons trial is in response to customers requesting year-round access to lamb “at an accessible price”.
“We do not intend this move to mean a reduction in the overall volumes of lamb that we buy directly from British farmers.”
Karapeeva said the move by Morrisons will expose more UK consumers to NZ lamb.
“Morrisons has stated that one of the factors behind its decision is that it is cheaper to source NZ lamb than British lamb, which is a reflection of how efficient NZ farmers are at producing lamb even when transport is taken into account.”
Karapeeva noted that the price of NZ lamb in the UK has been steady for the past six months at $9-$9.50/kg while volumes for the first quarter of this year were 57% higher and 48% greater by value.
Data provided to Farmers Weekly reveals sheep sold through UK saleyards in recent months have been making between £4 (about $8.34) and close to £6/kg.
An online search of UK retailers shows Tesco-branded whole lamb leg joint selling for £28/kg and described as “produced in the UK or NZ”.
The same retailer is selling Tesco-branded lamb chops for nearly £19/kg, similarly described as “produced in the UK and NZ”.
Lamb stocked by Sainsbury’s is similarly described as either British or NZ, with chops selling for £15.44/kg, lamb rump £15.83/kg and whole leg £14/kg.
