Meat & Livestock News

Australian Sheep Sector Faces Downturn Amid Export Uncertainty and Climate Challenges

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Australia’s sheep farming community is confronting a severe downturn, with mutton prices plummeting to their lowest in nearly two decades. This has led to distressing decisions for farmers, particularly in Western Australia, who are now facing the prospect of giving away livestock as feed or for nominal sums.

According to Tim Jackson, a global supply analyst at Meat & Livestock Australia, the price of mutton has seen a dramatic 75% decrease over the past year. In October, the average price for older sheep-dipped to just A$34 ($22), with some instances of sales below a dollar per head. This stark drop in market value is attributed to a combination of climatic and policy factors.

The anticipated El Niño weather pattern threatens to exacerbate the situation by bringing drier and hotter conditions, potentially reducing available pasture and forcing more animals to be sent to slaughterhouses, which are already operating at full capacity.

This situation is compounded by the government’s proposal to gradually eliminate live sheep exports, a move that has heightened concerns about an oversupply of mutton, especially in Western Australia, the primary state for live sheep trade.

Andrew Spencer, chair of Sheep Producers Australia, highlighted the dire circumstances for some farmers, with low-quality sheep being handed over to pet food manufacturers at no cost.

Steve McGuire, vice president of WAFarmers, recalled the distressing culls of the 1990s, a situation farmers are desperate to avoid repeating.

The industry’s downturn marks a sharp contrast to the record-high lamb and mutton prices enjoyed just three years prior. Recovery is not anticipated until the following year, according to Matt Dalgleish, co-founder of agricultural consulting firm Episode 3. 

The industry’s hope hinges on a return to normal rainfall patterns over the summer, which Dalgleish notes would significantly bolster the market.

In response to the crisis, there has been a surge of activism within the farming community. The leading agricultural association has initiated a campaign urging the federal government to reconsider the proposed ban on live sheep exports to the Middle East and to create a specialised visa route for agricultural workers.

In a related development, Woolworths Group, one of the nation’s principal supermarket chains, announced a 20% price cut on 26 Australian lamb meat products.

This decision follows criticism that retail prices have not decreased in line with the drop in wholesale costs, reflecting the broader economic pressures facing the sheep farming sector.