2015, Volume 18, Paper 101
ISSN: 1442-6951
Are we killing the Golden Sheep? The changing size and composition of the Australian sheep flock: implications for production and profitability
Edward Perrett – BA(Hons), MEnv (Governance, Policy & Communication), PGradCert Climate Change for Primary Industries,
The University of Melbourne
Email: eaperrett@gmail.com
ONE day a countryman going to the nest of his Goose found there an egg all yellow and glittering. When he took it up it was as heavy as lead and he was going to throw it away, because he thought a trick had been played upon him. But he took it home on second thoughts, and soon found to his delight that it was an egg of pure gold. Every morning the same thing occurred, and he soon became rich by selling his eggs. As he grew rich he grew greedy; and thinking to get at once all the gold the Goose could give, he killed it and opened it only to find — nothing.
“GREED OFT O’ERREACHES ITSELF.”
Aesop, The Goose with the Golden Egg
Abstract
The changing fortunes of the Australian sheepmeat and wool sectors have led to dramatic changes to the national flock. In recent years the profitability of the sheepmeat sector has provided mixed signals to producers to simultaneously sell to capitalise on high prices, particularly for mutton and breeding stock, while also shifting enterprises towards dual purpose (meat and wool) and specialist lamb production systems.
This essay provides a summary of changes to the Australian sheep flock in the past twenty years, including the growth of the sheepmeat sector and the decline of the wool sector. It considers drivers of profitability in the sheep industry, comparing the recent economic performance of prime lamb, dual purpose, and wool flocks. It is suggested that there are a number of common factors evident in the most profitable sheep businesses. A discussion about risk management and volatility helps explain the rise of dual production systems, the persistence of risk-averse wool enterprises, and highly productive but volatile returns for specialist prime lamb producers. Flock structure is identified a major determinant of profitability, with breeding ewes critical to production.
The challenges posed will also shape the future of the Australian sheep flock. Fertility and drought-induced sell-off are noted as major factors affecting changes to the Australian flock, which could be exacerbated by an increasingly variable and extreme climate.
Finally, this essay considers the future size and composition of the Australian sheep flock. A flock structure model is used to estimate the effects of hypothetical changes to marking and slaughter rates.
It is concluded that it remains possible to sustain production and kill the ‘Golden Sheep’, provided there is a focus on productivity and reproduction efficiency to ‘optimise’ the remaining flock.
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