High beef and sheepmeat prices are providing a buffer against crippling drought with livestock tipped to contribute 53 per cent of forecast total farm production of $61 billion in 2019-20.
In its latest quarterly predictions the national commodity forecaster, ABARES, says total agricultural gross value will slip by three per cent this financial year but the fall would have been much worse without buoyant livestock prices.
The livestock sector's contribution to total farm production would reach 53pc for the first time since 1990-91, the year the reserve price scheme collapsed and Australia had 100 million more sheep than now.
ABARES said because of the ongoing drought, farm export earnings would dive by 8pc to $45 billion in 2019-20 because of lower livestock and crop production and the diversion of more grain into the domestic market for stock and human consumption.
It said the current seasonal conditions were remarkable in their extent and severity compared with previous major droughts.
In October 2019 vegetation cover across NSW, Queensland, the Northern Territory and Western Australia were noticeably lower than in October 2007, the last major widespread drought.
Both cattle and sheep numbers are tipped to keep declining in the coming months as drought-hit producers continue selling off stock.
The cattle herd is expected to drop by 5.4pc to 23.5 million by next June, its lowest level since the early 1990s, while the national sheep flock would slip by 3pc to 64.9m.
No serious flock and herd rebuilding was expected to start until late autumn and winter next year and ABARES said a major recovery in stock numbers would take five to 10 years.
African swine fever outbreaks were continuing across Asia which was pushing up demand for imported sheepmeat and beef.
Retail pork prices in China, the country worst affected by the disease, doubled in the 12 months to October while beef prices jumped 20pc and mutton prices by 16pc.
Unfortunately our reduced stock numbers will hamper Australia's ability to take full advantage of booming export demand with beef exports tipped to decline by 5pc to 1.167 million tonnes in 2019-20 worth $9.8 billion.
Average saleyard cattle prices are predicted to jump 12.1pc in 2019-20 to 500 cents a kilogram carcase weight.
Sheepmeat exports are forecast to slide by 14pc to 421,000 tonnes valued at $3.66 billion, a year-on-year drop of 14pc.
Saleyard lamb prices are predicted to jump by 9pc to 790c a kg dressed while sheep prices are forecast to climb by whopping 26pc to 570c.
Live cattle exports are expected to fall by 5.3pc to 1065m head worth 1.3 billion, down 3.8pc.
Live sheep exports are forecast to fall by 10pc to 915,000 head valued at $136 million, up 12pc.
The value of the wool clip is predicted to decline by 28pc to $3 billion. The Eastern Market Indicator is forecast to average 1602c a kg clean in 2019-20, a fall of 27pc on the previous year's high levels.