The Alliance meat co-operative says figures showing a two million lower than expected drop in export lambs this year may not be as bad as they seem.
Chief executive Grant Cuff says one of the factors behind the decline may be that farmers are holding onto some of their lambs to rebuild their flocks after the droughts.
He says higher lamb retention is positive for meat companies because it means more lambs in future years.
Also, late autumn and early winter were cooler than usual.
