Reduced supplies and Chinese demand will send lamb prices climbing this year, New Zealand's biggest meat processor and exporter says.
Silver Fern Farms says while that is good for farmers, it also raises the risk of lamb becoming unaffordable again, as happened two years ago.
Silver Fern chief executive Keith Cooper has just returned from the giant Anuga food festival in Cologne, Germany, and meetings with customers in Europe.
"We clearly gave them the message that we've got slightly lower production from New Zealand, we have no inventory in New Zealand and we have a great, big, hungry dragon called China that has already purchased significant volumes going into the next season," Mr Cooper says.
"Everyone is under no illusion that supply will be tight, and we've already seen some price escalation occur in the last two to three weeks, so it's very real, customers understand it and there will be an escalation in prices in the coming season out of Europe."
However, the big concern is that the price doesn't go beyond a point where it blows the product off restaurant menus and out of retail stores, as has previously happened.
