Sheep doldrums on the repair

IN RECENT times there has been a lacklustre interest in the sheep industry, as farmers consider other alternatives that would offer a better return.

The cost of labour, especially at shearing time, has seen farmers in the negative after shearing – and that’s if they can find a team to do it.

So it is enlightening news to see that results from a recent Sheep Producer Intentions Survey (SPIS) from Meat & Livestock Australia (MLA) and Australian Wool Innovation (AWI), show that Australian sheep producer confidence has jumped substantially this quarter, riding on the back of improved prices.

According to this latest survey, sheep producers are buoyed by better prices for lamb and mutton and improving seasonal conditions in some states.

Producer net sentiment for the sheepmeat sector has lifted from minus-42 points in October 2023, to plus-42 points in October 2024.

All states other than Western Australia reported a positive outlook for the sheepmeat sector, with NSW (plus-55), Victoria (plus-52) and Queensland (plus-41) reporting the highest numbers.

Western Australian producers, who face a series of challenges including the cessation of live sheep exports, tough market conditions and dry season conditions, reported a sentiment figure of minus-2 points, although this is a 69-point increase compared to the 2023 figure.

According to MLA senior market analyst Erin Lukey, this edition of the SPIS had the largest response rate ever, collecting 2579 producer responses and representing 10 per cent of sheep producers across the country.

“This gives us a strong indicator on the state of the industry and describes producers’ intentions for the year ahead,” Ms Lukey said.

“This edition of the survey focuses on lambing intentions and whether producers plan to grow, maintain or reduce their flock sizes.”

The survey shows nearly equal proportions of producers are intending to increase (40 per cent) or decrease their flock (39 per cent).

This has shifted from last year’s survey, when more producers were looking to decrease their flock.

The survey reveals that the reasons why depend on which state you live in, with Western Australian and South Australian producers – who have had drier weather than the eastern states – were more likely to want to reduce their flocks at 51 per cent and 49 per cent respectively.

And 47 per cent of NSW producers indicated a desire to grow their flocks, with the most common reason being an expectation of higher lamb prices in 2025.

Analysis of the forecast change in the number of lambs suggests an expected reduction of about 250,000 lambs of the estimated 2024 flock size, equating to a forecast decrease of 1 per cent on 2024.

Ms Lukey said this result highlighted the importance of considering the reported changes in flock size rather than just producers’ disposition to change.

“Differing conditions across states will impact regional flock sizes, but also the intentions of different sized enterprises,” she said.

“Growth in the NSW flock has combatted the climate-driven decrease across other states, resulting in a level national flock.”

This survey has also revealed changes in the lamb flock profile with prime lambs (38 per cent) remaining above merinos (35 per cent) within the 27 million lambs on hand.

Merinos fell from 37 per cent to 35 per cent over the past year and shedding lambs lifted from 5 per cent to 8 per cent of the flock.

“Reasons as to why include a struggle to access labour for shearing, rising input costs and poor wool prices,” Ms Lukey said.