Lamb values as always at this time of year, have been on a bit of a rollercoaster ride depending on supplies. However, even at 250p per liveweight kg they are higher than this time last year.

While the previous week's sales held firm with many live auctions seeing averages in the 260p plus per kg mark, demand has been a tad more lacklustre at the early sales of this week as increased numbers hit the market.

"We had an extra 500 lambs this week compared to the previous week, so the sale average for 4177 head slipped on the week, but at 250p per kg, that's still 8p ahead of the same time last year," said Archie Hamilton, head sheep auctioneer at Lawrie and Symington's Lanark Mart.

However, he added that while the trade is back, some sheep appeared dearer on the week, with 38kg Blackface wedders selling for £86 and 46kg Mules up to £107 per head.

"Best quality lambs still sold well and weight came to the most money," said Mr Hamilton.

It was a point echoed by Drew Kennedy, sheep auctioneer at Craig Wilson's Ayr and Newton Stewart centres.

"The trade was back at Ayr on Monday, but there are a lot more numbers coming forward and today (Wednesday) at Newton Stewart, I'd almost say it was sharper with a better quality show. The buyers seem to be looking for heavier lambs up to 44kg and they always want a bit of cover."

The fall in prices has been reflected throughout the UK, with prices south of the Border levelling at 254.7p on Monday and 255.5p on Tuesday.

Overall averages on Monday at live auction marts in Scotland worked out at 250.2p, and rose marginally on Tuesday to 251p.

Looking at the numbers, the latest Defra statistics show 1.06m lambs were slaughtered in June which is an increase of 140,000 head from May, and up 184,000 head (21%) from June 2022.

Exports for May totalled 5550 tonnes (fresh and frozen sheep meat) – down 1620 tonnes from April but largely stable year-on-year.

Shipments to the EU have been relatively strong through the first four months of the year, supported by competitive GB pricing and lower production on the continent.

However, GB prices rallied through the spring and by May were closer to equivalent prices in France, potentially reflecting changes in trade volumes at the time. GB prices have since eased back, as have prices in Ireland and Spain. Meanwhile, southern hemisphere product continues to be competitive, partly due to a combination of higher Australian production and subdued export demand.

According to AHDB, UK sheep meat imports increased in May from the previous month to 4700 tonnes (mostly driven by New Zealand), but this was still down notably from last year, as has been the case since January. Demand is lower in the domestic market compared to a year ago, as consumers wallets are squeezed from the increased cost-of-living.

Looking further afield, China continues to play a key role in the global sheep meat market, with Australia and New Zealand making up 93% of China’s sheep meat imports in May. Exports from Australia have grown to China, up 2200t from April to May, and up 6600t from May 22, as they continue to increase their production.

Increased supplies have been weighing on domestic prices, making Australian exports more competitive. Whilst exports from New Zealand to China have grown slightly (555t) from April to May, there has been growth of over 8200t from May 2022.

There are however, uncertainties over the sustainability of Chinese sheep meat demand. Reports suggest that fragile economic conditions in China are not incentivising consumption growth, but recent announcements of government support for businesses may improve consumer confidence.