Back to Prices & Markets

Subscribe to Prices & Markets e-newsletter

For in-depth red meat market news, information and analysis.


How are Australian and global SHEEPMEAT producers performing?

12 January 2017

Highlights from the latest agri benchmark network results for Australian sheepmeat producers include:

  • Sheepmeat prices remain comparatively high, due to rising global demand (especially in China and the Middle East) – since peaking in 2011, prices have declined and are expected to continue declining over the next few years as supplies respond
  • Sheepmeat consumption will continue to grow slowly in developed countries by 2% per annum and 12% per annum in developing countries, with 94% of total consumption growth in Asia and Africa
  • Sheep farms globally continue to make profits at the whole farm level, and in some countries this is related to the level of diversification or government support
  • Australian and New Zealand sheep farms are the most profitable in the medium-term, although profit levels have declined slightly from 2014 levels
  • In Australia, total returns to the sheep enterprise only (not counting returns from other outputs of the farm such as crops or cattle) for the eastern typical farms had more mixed results, with nearly all farms experiencing decreased returns across most categories in comparison to 2013 and 2014
  • Australia tends to have similar ewe and lamb losses to most other regions of the world, with the exception of South Africa, Brazil and France
  • Australian farms tend to have lower weaning rates than European countries, and maintain similar weaning rates to more rangeland or less-developed production systems where nutrition and/or genetics may be constraints
  • Australian systems generally maintain above average growth rates for animals being sold or slaughtered at weaning, which is comparable to most global regions, including Europe and NZ
  • All Australian systems achieve cash costs of <USD2/kg lwt of sheepmeat produced. Globally, only farms from Uruguay, South Africa, Namibia, Brazil and NZ have total costs <USD2/kg lwt. Extensive grazing systems are the least expensive for producing sheepmeat
  • Australian labour costs are 10 times higher than China, African and South American countries, and 50% higher than NZ and European countries. This is counteracted by Australian sheep systems producing 5-10 times more sheepmeat per hour of labour input than the rest of the world
  • Australian farms maintain a low total cost of sheepmeat production, with New Zealand, Uruguay, and some farms in China, Brazil, Namibia and South Africa also maintaining low total costs.

For the full sheepmeat report and analysis, click here.