AUSTRALIA-MEAT NOW MAIN PRODUCT AND WOOL BY PRODUCT.
The days when wool was the nation’s biggest export earner are long over, it is now a matter of riding on the sheep’s backstrap, with the sheep-meat industry set to defy the global gloom for the next two years.
The Australian Bureau of Agriculture and Resource Economics predicts a 12 per cent rise in farm exports to $30.8billion in 2008-09, with a further 4 per cent rise expected in 2009-10.
While the man on the land is set for a 28 per cent pay rise this year -- with export earnings for wheat, barley, canola, cotton, sugar and lamb forecast to rise -- miners face a 22 per cent decline in earnings from $161billion in 2008-09 to $126billion in 2009-10.
But the slump could be short-lived, with ABARE, in its issue of Australian Commodities released yesterday, expecting export earnings to gradually pick up again from 2010-11.
Below the earnings forecasts lie huge changes on the farm as the number of sheep has more than halved from 174million to 79million over the past 20 years and graziers have switched away from wool and into meat sheep.
In the days when Australia rode on the sheep’s back, Australian lamb meat came from merinos, a by-product of the wool industry. Wool is now in danger of becoming the by-product of its one-time poorer sheep-meat cousin.
Rodney Watt, from Greenethorpe, 250km west of Sydney, used to be a prime lamb and wool producer. These days, he focuses on ram production, selling 300 meat-breed rams a year to wool growers who are shifting their operations.
"Only this morning, I sold rams to a woolgrower who produces hundreds of bales of wool, quite a significant woolgrower, who was looking for the change," Mr Watt said yesterday. "I have had people well into their sixties who have said, ’I have never bought anything but a merino ram all my life, now I am changing’." Mr Watt breeds and sells poll dorset and white suffolk rams. Farmers can join meat-breed rams with merino ewes to produce prime lambs and they can continue to produce wool from their merino ewes.
ABARE executive director, Phillip Glyde said yesterday "a substantial" increase in crop production combined with "a significant" depreciation of the dollar was expected to support farm export earnings in the short term.
Down on the farm, average income is projected to rise from $62,500 in 2007-08 to $80,000 in 2008-09. But that improvement will be largely confined to Western Australia, northern NSW and Queensland. The long dry continues to depress earnings throughout southeast Australia.
Sheepmeat Council of Australia president Kate Joseph said the switch from wool to meat came down to basic economics as lamb prices in December and January reached record levels.
"The wool industry is going through a bit of a downturn. But there is worldwide shortage of lamb, of sheep meat, and we can’t keep the supply up, so it is a good opportunity for these guys to diversify," she said.