Live sheep export review vs competitors

The Detail

Last month, the government announced their phase-out of live export, which will ban live sheep exports by sea in May 2028. That is unless the government switches to a coalition at the next election, as they have promised to reverse the ban, although that will require both houses.

In this analysis, I wanted to look at our trade from last year versus that of other competing nations. In 2023, live exports of sheep increased strongly from a record low in 2022, increasing by 30%.

In the first chart below, we can see the volume for both 2022 and 2023. I have chosen the countries that export most of the world’s sheep and have omitted some exporters who only ship via road to their neighbours, such as Namibia.

The countries with the most significant volume changes were Australia, which increased by 30%, and Georgia, which increased their trade volumes by 74%.

The countries dominating live exports are Jordan, Romania and Spain. It is important to remember that many exports in countries like Romania and Spain are exported overland (via truck) within Europe.

The second chart is there to show clearly the percentage change for each country.

It’s great that Australia increased its volume of exports last year, especially after years of export declines. Let’s delve more into this, as this tells an interesting story.

Despite the 30% increase in the volume of sheep exported from Australia, the actual value declined. In 2022, the FOB value of the trade was US$56.9m, and in 2023, it had fallen to US$49m.

Why was this?

To delve further, we can look at each country’s average export price for sheep. This is a crude calculation, but it indicates the average price of a sheep loaded onto a boat.

This is displayed in the chart below. Out of the nine countries selected, which are the major sheep exporters, Australia had the cheapest unit cost out of all nations, at US$71 per head, a drop from A$108 per head in 2022.

The price in Australia was considerably lower than the other export nations. If we look at the different nations, all except Portugal had an increased average unit price in 2023.

In parts of 2023, Australia was going through a period of low pricing for sheep, which meant that we were attractive as a nation, and our volume increased. This is basic economics; if a price is low, it will attract demand.

It is important to note that these are FOB numbers and freight to destination needs to be added, but the trend is still shown.

It is well known that Australia has good quality sheep and the strongest animal welfare standards of the major exporters, but the importers also got a pretty good bargain last year.