National sheep flock tipped to hit 16-year high in 2023: Meat and Livestock Australia

2023 is shaping up to be a record year for Australia’s sheep industry, with lamb production and exports forecast to hit historic highs and the national flock tipped to reach a 16-year peak of 78.75 million head.

That’s according to Meat and Livestock Australia’s February sheep projections report, released this week, which has forecast “continued growth and development” for the industry.

MLA predicts Australia’s sheep flock will grow to 78.75 million head this year — its highest level in 16 years — on the back of optimal breeding conditions nationwide.

Other factors driving the increase include “a genetically superior flock”, improved lambing percentages and “medium-term industry confidence” at farm gate level.

“Growth is forecast across all States, with larger improvements in flock numbers expected from South Australia, Western Australia, Queensland and Tasmania,” the report said.

“The key sheep producing States of New South Wales and Victoria are also forecast to lift numbers, although not as significantly as other States.”

MLA senior market information analyst Ripley Atkinson said the growth of the national flock in 2023 would boost slaughter numbers and production.

“Lamb slaughter is forecast to reach 22.6 million in 2023 as a result of large numbers of breeding ewes and strong marking rates,” he said.

“This is a rise of 595,000 head, or 2.7 per cent year-on-year. “2022’s slaughter performance showed that small stock processors had a greater ability to increase their throughput in line with higher supply, a trend MLA expects will continue in 2023.”

In 2024, the national flock is forecast to hit 79.5 million head — up one per cent or 750,000 head year-on-year — amid predictions growth will “moderate and plateau”.

The national flock is forecast to drop back down to 2023 levels in 2025.

“Looking ahead to 2024, we forecast it to be a record year for lamb slaughter, reaching 23.2 million head,” Mr Atkinson said.

“This would be a rise of 3 per cent, or 560,000 year-on-year, and higher by 1.1 million head or 5 per cent on the 10-year average.”

Sheep slaughter was also forecast to increase by 24 per cent or 1.46 million head in 2023 to a total of 7.6 million head.

The report said the current breeding ewe base would grow beyond 2016 levels in the coming year as producers removed non-performing females and introduced new genetics to their breeding flocks, driving up sheep slaughter significantly.

Sheep slaughter was forecast to reach 8.46 million and 9.48 million head in 2024 and 2025 respectively.

Carcase weights were also forecast to increase marginally this year, the result of structural genetic investment and productive improvement in the national flock over the past two years.

Lamb carcase weights were forecast to reach 25.1kg — 11 per cent or 2.5kg/head above the 10-year average — despite forecasts of drier conditions in the second half of 2023, particularly across southern Australia, where most of the sheep population is located.

Mutton carcase weights were expected to rise to 25.5kg/head in 2023 and remain “relatively stable” at above 25kg over the next three years.

Lamb production was forecast to smash last year’s record by about 20,000 tonnes in 2023, rising to an all-time high of 569,000 tonnes on the back of historically high carcase weights and slaughter.

“In 2024 and 2025, further increases to 577,000 and 585,000 tonnes respectively are forecast as carcase weights remain strong and slaughter reaches record highs,” the report said.

“It is expected that these record production levels will significantly enhance Australia’s export volumes, also forecast to hit records for the three years from 2023.”

Mutton production was tipped to increase by 25 per cent this year to 193,000 tonnes, and to continue rising to 214,000 tonnes in 2024 and 237,000 tonnes in 2025.

Looking abroad, Mr Atkinson said New Zealand’s declining sheep flock presented an opportunity for Australia to increase its market share as the world’s biggest sheepmeat exporter.

New Zealand is the world’s second-biggest exporter of lamb and mutton.

“New Zealand, like Australia, has good market access, quality assurance schemes and a strong reputation internationally, meaning that they are an international competitor to Australian lamb and mutton,” Mr Atkinson said. “However, new opportunities may be made available to Australian producers and exporters as New Zealand’s flock size decreases, wool and lamb production become less profitable compared to dairy production, and land availability decreases.

“In recent years, successive Australian governments have made considerable strides in gaining European market access, with talks ongoing for an Australia-European Union Free Trade Agreement and the Australia-UK FTA signed in December 2021. “As New Zealand sheepmeat exports have increasingly shifted away from Europe and towards China, improved opportunities for Australian sheepmeat in European markets may continue.”

The report said Australia’s sheep industry was in an “exciting position” as global demand for high-quality sheepmeat in established and emerging markets continued.

“The industry’s ability to continue to deliver high quality protein and be a world-leading producer will define 2023 as a positive and optimistic year,” the report said.