It started out with cut-price cooked chooks but the major supermarket chains are now butchering the price of lamb, sparking a sector-wide meat war.

German discount giant Aldi stole the lead on Woolworths this week, undercutting Australia's biggest supermarket chain's $3.99/kilo discount on a leg of lamb as did rival Coles, which has been running its own $9/kilo lamb special.

Woolworths fired the starter's gun on this latest round of pricing one-upmanship, after it cut the cost of its lamb leg to $10/ kilo, along with the price of other popular meat lines including mince and sausages last week.

Aldi's latest meat price reductions have cut the cost of a leg of lamb to $9.49/kilo and whole chickens to from $3.99/kilo to $3.79/kilo.