WA sheep processors face challenges as the flock continues to shrink

WA’s sheep abattoirs may be forced to mothball their operations in the next year because of high livestock prices and unsustainably low volumes. That is the warning from WA Meat Marketing Co-operative chairman Craig Heggaton, who farms near Kojonup. He said dry conditions over the past two years had accelerated WA’s long-term decline in sheep numbers to the point where not all local processors could remain open and viable. His warning comes as the Department of Primary Industries and Regional Development reveals sheep numbers are projected to have plunged by about a further one million in the past year to between 12.9 and 13.4 million head, because of high processing volumes and record numbers sent east. That was down from 14.3 million sheep and lambs, including 7.8 million breeding ewes, as at July 2019, DPIRD said. By comparison, WA sheep numbers were 38.4 million at their peak in 1990. Prolonged dry conditions across WA have driven an exodus of sheep to the Eastern States. DPIRD figures show a record 904,000 sheep were transferred east between January and May. “Farmers are being offered good money with the strong Eastern States demand,” Dr Heggaton, pictured, said. “If they retained their sheep it means carting water and hand-feeding because of the dry conditions. “WA needs about 13-14 million sheep, turning off about five million lambs a year to processing or export to keep the industry viable. We are not going to be getting those numbers. Processors will be competing for a smaller number of sheep by paying higher prices, putting pressure on margins and not all will be able to continue.” Fletcher International WA general manger Greg Cross said that after a strong year with high processing volumes, he expected a challenging 12 months ahead at his processing plant near Albany, as numbers declined. He said meat processing was volatile and the current situation reflected 2010 when about 1.3 million sheep were sent east over a year. “At that time, it took a good two seasons of decent rainfall for the sheep flock to recover,” he said. A weaker wool price — which last week fell to its lowest level in five years — did not have any short-term influence on WA’s dwindling sheep numbers. “Farmers are seeing the wool price fall as more of a hiccup to do with market demand, ” Dr Heggaton said.