The report, Australian lamb: financial performance of slaughter lamb producing farms, 2006-07 to 2008-09, was released today by ABARE’s Executive Director, Phillip Glyde.

“In 2007-08, seasonal conditions remained hot and dry in most of the major prime lamb producing regions of Australia, resulting in many producers increasing their turn-off of sheep and lambs,” Mr Glyde said.

Increased turn-off and higher prices, particularly for lambs and grains, in 2007-08 resulted in slaughter lamb producers realising a 34 per cent increase in average farm cash income to around $92,000 a farm.

“Revenue from sales of prime lambs fell in 2007-08, despite the increase in turn-off, as many producers sold lambs earlier in the season prior to them being fully finished. Consequently, the number of non-prime lambs sold increased substantially in 2007-08,” Mr Glyde said.

“Improved seasonal conditions in 2008-09 are projected to result in producers’ farm cash incomes increasing by another 21 per cent to average $111,700 a farm,” Mr Glyde said. Farm business profit is projected to average $8300.

However, Mr Glyde said that producers indicated they intended to reduce
turn-off to rebuild sheep numbers in 2008-09. This will result in the improvement in farm cash incomes being weaker than what would otherwise be expected.

“In recent years, the slaughter lamb industry has undergone a period of significant new investments in capital, particularly land. This, combined with high equity levels, will enable most producers to finance their recovery and expansion,” Mr Glyde added.