Sheep producers gross margins drop for Victoria, while NSW grows

Elmore farmer Dianne Trewick says a good ewe base is crucial, as new data shows a win for prime lamb production and replacement purchases.

Prime lamb enterprises and first-cross replacements, both mated to terminals, are steaming ahead for gross profit margins in NSW, new data shows.

The NSW Department of Primary Industries and Regional Development’s latest gross margin calculations showed 20-micron ewe and first-cross ewe enterprises, both joined with terminal rams, had an economic return increase by five per cent from 2022.

NSW DPIRD sheep development officer Geoff Casburn said main contributions to the NSW gross margins were stable slaughter lamb values and lower replacement ewe costs.

He said wool-focused businesses generally had higher harvesting costs, and meat-focused would have higher replacement ewe and fodder costs.

Pepperton Poll Dorsets and White Suffolks stud principal Roger Trewick, from Elmore. Picture: Supplied by Kim Woods

Mr Casburn said the second top performers for NSW, self-replacing Dorper enterprises, had a gross margin of $28.71 per DSE.

They recorded third-highest sheep sale income, and lowest variable costs per DSE.

Mr Casburn said Dorper producers could avoid wool price volatility and high labour costs, with an absence of wool harvesting costs and low replacement expenses.

“There is anecdotal evidence that a shortage of shearers and shed hands in 2024 has driven wool harvesting costs higher across many regions,” he said.

“A combination of lower wool incomes, weaker mutton sale values, and an oversupply of ewe hoggets and wether weaners has put downward pressure on prices, resulting in reduced incomes for many sheep producers.”

Mr Casburn said a self-replacing 18-micron wool-focused enterprise had lower earnings than in 2022, but remained on-par with meat-focused businesses.

He said producers should focus on enterprise flexibility and diversification across both wool and meat productions.

Meanwhile, in northern Victoria, at Elmore, Pepperton Poll Dorsets and White Suffolks Dianne Trewick said it was crucial to have a good ewe base with strong figures.

Ms Trewick and her husband Roger would soon disperse their stud to solely focus on a 300-head commercial flock with their ewes.

“We’ve always found they’re good value, they really are. The Poll Dorsets have really good muscling and good growth, clients can get the lambs off early to the sucker market and give their ewes a break,” she said.

“Our White Suffolks have exceptional muscle through them, and we just find they’re easier. The Whites are snapped up by the Merino breeders who want to go in for a bit of meat if the wool isn’t doing so well, and it’s an alternative for them.”