Australia-Live shippers offering minimum AU$80 for wethers.

IN a move to inject some optimism into the sheep industry, Wellard Rural Exports is offering an $80 minimum price forward contract for heavyweight wethers.

It is believed this is the first time such a program has been implemented in WA.

The forward contracts will be for live export wethers and rams and guarantee a minimum price for export sheep up to nine months ahead of delivery.

The minimum price contracts enable farmers to choose between the forward price and the spot price at delivery - whichever is higher.

The move signifies the growing concern at the true level of the national sheep flock and the stress that puts on WA’s live export markets.

Wellard Rural Exports livestock manager Garry Robinson said the contracts will give farmers the price and market certainty they need to continue breeding and supplying sheep.

"They can lock in an extremely competitive price now, plus capture any price upside based on the market at the time of delivery," Mr Robinson said.

"Farmers can hedge against price falls, capitalise on price rises, and benefit from the reduced production risk sheep provide compared to other competing farming options.

"It will give sheep producers the ability to run sheep in the full knowledge they have a guaranteed minimum price and guaranteed market when they are ready to sell."

Wellard began offering forward contacts for dairy heifers in 2008, and has been extremely pleased with the uptake from dairy farmers who sought to lock in a price before carrying their heifers through to the maturity required by live export.

Wellard Rural Exports managing director Steve Meerwald said the release of similar forward contracts for sheep was also designed to continue to stimulate optimism in the sheep industry.

"The sheep flock has been in decline," Mr Meerwald said.

"It is in the live export industry’s interests not just to provide some clear price signals to producers, but to enable them to lock in prices which will encourage them to continue to produce the top quality