While prices over the past two years in the sheep sector generally have been at record levels, it is the case that in recent months prices for hoggets and cull ewes have been relatively low. This is due to a large extent on the overhang of lamb in the market and, in particular, the UK.
In response to representations which I made to the EU Commission, a scheme of aid for private storage has been agreed by the Sheepmeat Management Committee on 6 March. The objective of this scheme is to take up to 150,000 1997 season lambs off the market in Ireland and the UK over the next six weeks. This should allow the market to regain equilibrium before the 1998 season spring lambs become available. I am confident that this measure, if fully availed of by the factories, will play a significant part in restoring market confidence to the sector.
Towards the end of 1997 I sanctioned an additional £2.5 million in extra headage payments to assist sheep producers in disadvantaged areas. These supplementary payments should help to compensate hill sheep farmers for the lower prices they received from the market in 1997.
I have also established a forum representative of the industry as a whole to examine the wider challenges facing the sector, including the production and marketing patterns best suited to our conditions.
