Sheep projections
Australia’s sheep flock to reach largest size in over 15 years

Key points

• National sheep flock will grow to its highest level since 2007 at 78.75m head
• Record lamb production and exports are forecast for 2023, eclipsing totals set in 2016 and 2022
•The decline of the New Zealand flock size presents an opportunity for Australia to increase its market share as the largest exporter of sheepmeat in the world.

The Australian sheepmeat industry is set for another bumper year in 2023 as the national sheep flock grows to its highest level since 2007 at 78.75m head, according to the latest Sheep Industry Projections update from Meat & Livestock Australia (MLA).

Driving this increase are optimal breeding conditions nationwide, a genetically superior flock, improved lambing percentages and medium-term industry confidence at the 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 key sheep producing states of New South Wales and Victoria are also forecast to lift numbers, although not as significantly as other states.

In 2024 the national flock’s growth is projected to moderate and plateau, reaching 79.5 million head, a rise of 1%, or 750,000 head year-on-year. While in 2025, the national flock is estimated to fall to 2023 levels, although it will remain above the 10-year average.

According to Senior Market Information Analyst at MLA, Ripley Atkinson, the growth of the national flock in 2023 will lead to increased slaughter numbers and production.

“Lamb slaughter is forecast to reach 22.6m in 2023 as a result of large numbers of breeding ewes and strong marking rates. This is a rise of 595,000 head or 2.7% 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.”

“Looking further ahead to 2024, we forecast it to be a record year for lamb slaughter, reaching 23.2m head. This would be a rise of 3%, or 560,000 year-on-year and higher by 1.1m head or 5% on the 10-year average,” said Mr Atkinson.

Carcase weights are also forecast to increase in 2023. This is primarily due to structural genetic investment and productive improvement in the national flock over the past two years.

In 2023, lamb carcase weights are forecast to remain high at 25.1kg. This would be 11%, or 2.5kg/head, above the 10- year average. This is despite weather forecasts suggesting drier conditions will occur in the second half of 2023.

The Bureau of Meteorology (BOM) has forecast that the Indian Ocean Dipole (IOD) will enter a positive phase in 2023. A positive IOD results in less rain across southern Australia, where most of Australia's sheep population is located.

As the second largest sheepmeat exporter in the world, New Zealand plays an important role in the global lamb and mutton market. However, according to Mr Atkinson, a decline in the New Zealand sheep flock size presents an opportunity for the Australian sheepmeat industry.

“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.

“However, new opportunities may be made available to Australian producers and exporters as New Zealand 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 (AU)-European Union (EU) Free Trade Agreement (FTA) and the AU-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,” said Mr Atkinson.

Overall, Australia’s sheep industry is in an exciting position of continued growth and development, with local production and the flock forecast set to rise, while global demand for high quality sheepmeat in established and emerging markets continues.