THE Western Australian sheep industry has been relatively stable over the past few years, despite the high number of transfers to the Eastern States from 2019 to 2021.
This year it should remain steady, if not grow, but the most interesting point may be a shift from Merino into other breeds.
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According to Department of Primary Industries and Regional Development research scientist Kate Pritchett, there has been gradual change from sheep to cropping over the past 30 years.
Flocks peaked in WA in 1990 at 38.4 million head, declining to 14.7m in 2010 and then remained steady.
"Over the past 30 years, the WA sheep flock has changed in structure and composition," Ms Pritchett said.
"The breeding ewe component of the flock has increased significantly from 45 per cent in 1990 to 60 pc in 2020, while at the same time the proportion of wethers in the flock has decreased from 32pc to 8pc.
Ms Pritchett believes this is "largely due to the rising importance of sheepmeat, especially lamb", as producers become less reliant on wool following low prices after the stockpile era.
"The value of the sheep industry has increased from a total of $966m to $1.3 billion, despite the large decline in the size of the flock, this equates to a rise from $25 per head to $93/h," she said.
Last year's Census data on flock numbers should be released later in the year, but as of July 2020 the Australian Bureau of Statistics (ABS) reported a WA flock of 13.7m sheep and lambs, a decline of 5pc year-on-year from 14.3m in 2019.
"The decline is believed to be due to high numbers of sheep being sent east as the Eastern States restock, following a severe drought, as well as dry seasonal conditions being experienced in WA at the time," Ms Pritchett said.
Nutrien Ag Solutions commercial sheep manager Katanning, Tom Bowen, also believes this contributed to a change in sheep numbers.
"Lack of water catchment in the two previous seasons did not give growers any option but to move stock out," Mr Bowen said.
"The very strong demand from the Eastern States restocking was a godsend, to get the prices up and save us."
However, after good seasonal conditions from 2021 Ms Pritchett doesn't expect that decline to continue, if anything it should start to rebuild.
"So far in 2021 to 2022, adult sheep slaughter has declined over 30 pc year-on-year to very low levels and interstate transfers are slowing leading me to believe they may be being kept on farm which is a good sign for the WA flock," she said.
Last year the season served growers well, meaning numbers will hold steady.
"In 2021 there was an early break and it was consistent throughout the year, dams were full through the State and the prices for the sheep remained constant and solid, giving our growers the confidence that the market will stay strong in the coming year," Mr Bowen said.
"There won't be many people reducing the numbers because of the cost of cropping and the return on numbers is very good."
In 2019 to 2020, the gross value of agricultural production for the sheep industry in WA was 1.3b, this number consisted of $637.2m from wool and $689.6m for sheepmeat (including live export).
According to the Meat & Livestock Australia and Australian Wool Industry, Wool and Sheepmeat Survey report released in October 2021, nationally there were 29.4m lambs, with 15.1m Merinos making up 51 pc of the total lamb flock, followed by 21pc pure meat breeds and 17pc first crossbred lambs.
The survey also noted that nationally 34 pc of producers are looking to increase ewe flocks through either retaining more replacement ewes or retaining older ewes.
In WA there were 7,507,384m breeding ewes on hand as of October 2021 and 4,641,161 lambs on hand.
Of which, 796,796 are first cross and 1,019,391 are Merino.
"What we've seen, and it's very pronounced in WA, is actually a movement away from Merinos to crossbreds," said MLA manager of market information Stephen Bignell.
"What we've got at the moment is only 72pc of the breeding ewes are Merino and that's down from well over 75pc, it was 74pc in July 21 and above 75 pc in May.
"So we're actually seeing the number of Merinos being used as breeding ewes change - that's a huge structural piece that we're seeing, it means people are moving towards meat sheep over Merinos."
Mr Bowen said producers were weighing up if they should move away from the Merino breed.
"People are getting an impression about the availability of shearers and are assessing their options if they can get shedding sheep," he said.
"The availability of shedding breeding ewes will be holding that change back.
"I don't predict there will be wholescale change, but it will remain steady as the year goes on."
The MLA and AWI Wool and Sheepmeat Survey also looked at producer sentiment, what they are intending and their attitudes towards the next 12 months in sheep.
"If you look at farmer intentions, 54 pc are looking to maintain and 36 pc of producers are looking to increase and 9 pc are looking to decrease which is below the national average," Mr Bignell said.
"The interesting thing is, when looking at breeds, you see the amount of Merino lambs were about the same but there are so much more first cross lamb sales.
"That's the piece we are seeing nationally and in WA, that move towards meat sheep is happening across the board."
Ms Pritchett agrees, noting that although there might be a price correction with restocking finishing in the Eastern States, demand will come from other areas and deliver more stability to the WA flock.
"Demand is likely to continue from other avenues for a different class of sheep such as slaughter lambs rather than breeding ewes," she said.
"Traditionally interstate transfers make up around 1-2pc of annual turn-off from the WA flock, however, this increased to 24 pc in 2020 to 2021.
"Local slaughter on the other hand accounted for 65pc or 3.7m sheep so is a much larger segment of the industry.
"If anything, reduced eastern demand will lead to more stability in the WA flock as less breeding stock are exported as opposed to slaughter stock."
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