Senate Rural and Regional Affairs and Transport Legislation Committee, , 7:00:17 to 7:06:46
Senators debate the impact of the live export ban and wool store closures on Western Australian flock numbers, wool production, and domestic lamb prices.
Topics: Live animal exports, Agricultural productivity
Speakers: Speaker 24, Senator Susan McDonald, Matt Lowe, Hon Matthew Canavan, Senator Paul Scarr
Well, Senator, that's a um there's a broad ranging set of supply and demand dynamics that are driving the flock. In terms of um WA, we we think the best estimate is about 10 to 11 million for the flock. And there's pretty strong um signals from the MLA and AWe uh sheep sentiment survey that there's an intention from WA producers to increase the flock, which is great. So, they we're looking, I guess, at a rebuild phase. um they're sheep producers of course so you know they're very cautious farm business owners um but we are seeing improved sentiment on both of
>> the failure of sheep policy when consumers have to pay so much Australian families are now paying a fortune just to feed their family uh something's gone horribly wrong is anyone looking at that about why these prices are so high
>> Senator I think it's fair to say
>> and the stock numbers are really low too
>> the industry is very conscious of the price of their product Um, but you would recall that uh I think Mr. Galliano will have more detail, but of course businesses are making decisions in relation to seasonal conditions. We've also seen incredible demand from our overseas market and so obviously farmers are putting their product into the right market at the right price.
>> But if that were the case, you'd think the stock the flock would be growing in size actually at record lows. Um, and and you know, the other aspect of this is you've taken away line of business for the supply chain more broadly. And when that happens in most businesses, average costs go up.
>> Senator, I mean, probably reflect that there's reason to be cautiously optimistic about the I guess the the future prospects of the Australian flock. Um some of those drivers you pointed to um for example sheet meat price and and wool price which is 4% above the um 10-year average I think are signals that um sheet producers will receive and make investment decisions on the basis of the signals that they're receiving currently. Um I will acknowledge in WA um that competition between cropping and um sheep enterprise is is something that producers are constantly balancing. Um cropping has also been very favorable in WA. Uh and those producers in WA are very good at getting off um um considerable um crops in in a v vast range of climatic conditions. So um all I'd say is I think there is reason to be cautiously optimistic about the future of the flock in Australia based on the current market signals.
>> Mr. Low, can I just jump in on that? What I'm hearing on the ground is that there's been um a as you say a couple of perfect storm in fact um the closure of the wool store um that has has had a terrible impact on on wool production in Western Australia at the same time as the removal of the live export portion of the sheep production uh decision making um means that we are seeing less sheep go through abbittoire bars in Western Australia. We're seeing flock numbers fall. Uh and the wool uh store, which the government was warned about that this would absolutely um you know, absolutely devastate uh productivity for sheep producers if you've got an attack on both wool and uh and numbers for for processing. So I think if you're being told that it's all ticky boo in Western Australia, uh that's not the case. And I, you know, we warned, National Party warned over and over about this would be the consequence of the shutdown of the live sheet trade in Western Australia. And unfortunately, at each point, this has been borne out. So, I would ask that you come back with some more updated information of what's happening to both wool production and sheet meat production in Western Australia. It's not pretty.
>> Uh, Senator, please don't misunderstand me. Um simply what I was pointing to is the market signals that are currently operating and and and as they exist and Australian farmers I know are very um responsive to um the market signals that operate in the sector um and make decisions according to how they can best ma maximize um the profitability of their enterprise in response to that. That's simply all I was saying.
>> Sure. Western Australia is a separate market though for this in this regard.
Senator, if I may, I would I would notice that yes, of course, we did see a number of sheep producers in WA who were disappointed by that wool store closure. Um, our transition advocate talked to a range of people. He's talking all the time and he recorded a broad range of sentiment. There were a number of sheep producers who uh thought that was a longstanding um business development that was going to come. >> I would also make the point the WA would
you just finish that thought? Uh what was a long-standing business
development? I I think there were a number of shoe producers who were expecting that that business change was coming and that they had seen it coming. So So that that's some of the market intelligence that our transition advocate has advised us.
>> That doesn't make it better though, does it? It just means that their worst fears were re realized as a
>> I saw the oncoming train coming.
>> Yes, that's right. I I recognize there's a whole range of signals, but I would note the WA wool collective has recently been formed and that's an industry-ledd group of businesses who are quite buoyant in terms of the future of wool. They took a delegation of WA sheet producers over to China to talk to a range of customers in terms of the kind of investment that's been made and in particular and then they brought two of those millers back to WA and they were recently in market and hundreds of farmers turned up to hear them. Our understanding is that because wool is now much more often being used in the active wear category where they're blending it with cotton and other products that they see there's a strengthening of the of the demand for wool. Now, of course, the wool price is going up and down, but it's interesting the current sentiment from a number of wool wool producers in WA and wool wool um wool uh stockus and the like is is is a quiet confidence and so you're seeing that we're seeing that in in some of the press reporting and and some of the
>> Uh yes, there is but not on I'm done with live sheep. I'll go to Celidor Grant. So, um, how many applications were received for round eight of the Salidor grant program?