The strength of the pound against the weak euro is a major factor, Meurig Raymond told reporters, making imports attractive to British retailers and exports to other countries less tempting, and farmers who were shifting their produce were having to settle for less.
Mr Raymond, president of the National Farmers’ Union, said: “Last year we were here (at the Great Yorkshire) and there were signs that prices to farmers were increasing but here we are in 2015 and the profitability of all sectors is under tremendous pressure.
“A lot of sheep farmers have invested heavily in making certain they are producing early season lamb at the right time of the year, on price, and this year has been very difficult to actually find a market for some of those lambs, for many reasons.
“Currency is obviously one of the big reasons why we as an industry find ourselves in a difficult situation. The pound’s strength has risen by ten per cent in 12 months.”
The Russian import ban and China’s withdrawal from the marketplace were factors too, he said, but the biggest issue is the perception of major retailers.
Farmers continued to be the losers of the supermarket price wars, he said, despite promises of better relationships with farmers post-horsemeat scandal two years ago.
“We appear to be in a situation where with the retailers, it is a race to the bottom, devaluing food. And when I hear how we now have deflation for the first time in 50 years in the UK, then it feels as if our members - the farming industry - have been responsible for delivering that deflation because of food values. “While you have got retailers knocking nine bells out of each other for profit, for market share, the price pressure comes all the way back down to the farmer.”
Mr Raymond praised Morrisons and Aldi for delivering on promises to stock British lamb throughout the year but said: “We have other major retailers who are very promiscuous with their purchasing and at this time of the year they are importing product while there is an ample supply of good quality British lamb available,” he said.
“We need to encourage better relationships and greater understanding all the way down that supply chain.”
He criticised Tesco in particular for not delivering “on red meat” after promises two years ago at the NFU’s annual conference to purchase more British product.
“Walk into any Tesco store today and there is more imported lamb on their shelves than there is British,” Mr Raymond said. “My message to Tesco is, prove to us you are going to carry out those commitments that you made two years ago.”