10 October 2002

Australia is in the grip of a serious drought and according to John Gorman, Aries Victorian Sheepskins and president of ICHSLTA and the Australian Hide Skin & Leather Exporters Association, the sheep and lamb raw market is in a worse condition than a year ago and overall quality of raw materials is deteriorating because of the drought. For hides, he sees the situation remaining about the same in Victoria, west Australia and south Australia but the effects of the drought in NSW and Queensland could see lower kills during the next year. On the subject of quality, he feels there is improvement being made since the vast majority of meatworks now have mechanical hide pullers. With regard to grain quality there has been no noticeable change in the past ten years. He believes that prices for sheepskins will remain at around current levels or even firm up and that prices for hides and calf skins will stay around current levels provided that the US economy does not move sharply in either direction. South-east Asia is their best customer for both hides and skins. The National Livestock Reporting Service reports that the total eastern state slaughter figures at the end of the 01/02 financial year indicate significantly lower levels that the previous year. Sheep slaughter experienced the greater decrease at 10% with lambs falling by 8% and cattle slaughter by close to 5%. The sheep figure shows the most change with only 10.8 million slaughtered, compared with 12 million head the previous year. Sheep numbers reached a peak of 180 million in1970. In general, numbers have fallen since then. Poor market prospects for wool after 1990 had a marked impact on the flock size with sheep numbers falling rapidly until 1995, after which there was a gradual decline until 1999. Improvements in wool prices and better returns for fat lambs saw an increase in confidence in the industry, with sheep and lamb numbers up 3% in 2000 to 118.6 million. The increased numbers in the marketplace was further compounded by rising prices that started to incline in early 2001. At that time, many in the industry thought that the rising prices could not be sustained and, as a result, the higher values continued to draw stock onto the market. The end result of this trend has been to make supply extremely scarce and sheep values are at extremely high levels as demand forces prices higher. The total cattle slaughter fell by around 5% with 6.5 million head processed. This may be partly attributed to the fact that kill figures peaked towards the end of the previous financial year, causing the reduction this year to be accentuated. Nevertheless, the closure of some plants for extended periods of time has no doubt contributed to the reduction in numbers slaughtered. However, the recent drought conditions in some areas have seen producers destocking and it could be that slaughter levels could continue to fall due to a shortage of supply. Cattle numbers in Australia increased slowly during the 1960s and 1970s, despite seasonal changes and heavy slaughtering. They peaked at 33.4 million in 1976. Drought conditions in the early 1980s led to a decline in the beef herd until 1984. For the next five years, the size of the herd remained relatively stable. Between 1989 and 1998, cattle numbers gradually increased despite unfavourable weather conditions continuing in many parts of the country. After a slight decline in 1999, cattle numbers again increased in 2000 to 27.6 million.

Privacy Policy
We have updated our privacy policy. In the latest update it explains what cookies are and how we use them on our site. To learn more about cookies and their benefits, please view our privacy policy. Please be aware that parts of this site will not function correctly if you disable cookies. By continuing to use this site, you consent to our use of cookies in accordance with our privacy policy unless you have disabled them.