Sheep Farming in Australia: Flock, Regions and Profit

Sheep farming in Australia is shrinking in numbers but strong on price. Meat & Livestock Australia (MLA) puts the national flock at about 64.2 million head at 30 June 2026, down 2.5% on a year earlier, after three years of below-average rain in key southern regions. Good 2026 rain in southern Australia and record-level prices for some sheep, lamb and wool categories have lifted producer sentiment. MLA forecasts a rebuild to 68 million head by June 2028, assuming average seasons.

This guide shows where the sheep are, what they produce, what the money looks like and what could change the outlook. It uses dated figures from MLA, the Australian Bureau of Statistics (ABS) and the Bureau of Meteorology. You can also test your own numbers in the margin calculator further down.

Sheep farming in Australia at a glance

Australia runs a pasture-based industry that sells both meat and wool. The table gives the main 2025 figures and the 2026 forecast from the MLA October 2026 sheep projections, the newest set at the time of writing.

“cwt” here means carcase weight. Slaughter falls in 2026 mainly because fewer animals are available, and because better feed lets producers keep more breeding stock. Lamb output falls less than lamb numbers because carcases are heavier: 25.9 kg on average in the 2026 forecast, up from 24.3 kg in 2025.

A note on flock numbers

You will see different flock totals online, and some are correct for their own basis. MLA’s Fast Facts 2025 gave 79.1 million head at June 2024. Its October 2026 table gives 71.4 million for the same date, on a series based on the ABS change in its farm-size cut-off from A$5,000 to A$40,000 in estimated value of operations. The ABS itself reported 70.2 million at 30 June 2022 under its release for that year. Compare trends only within one series. This page uses the October 2026 series unless it says otherwise.

The flock: why it fell and how it may rebuild

The MLA series shows a recent high of 74.2 million in 2023, then falling for three years. Producers sold heavily in 2024 and 2025, including many ewe lambs and pregnant ewes. Those sales cut the number of lambs born in the next generation, so a rebuild takes time even when the rain returns.

Chart

Australian sheep flock at 30 June

Million head; 2026 to 2028 are MLA forecasts

MLA expects 65.7 million head in 2027 and 68.1 million in 2028. That forecast assumes average seasons. MLA says a large part of the rebuild will have to come from ewe lambs, because so many older ewes were slaughtered from 2023 to 2025. It also warns that strong prices reward selling, which works against keeping breeding stock.

The longer trend is lower. MLA says the flock has dropped 35% in 20 years, driven mainly by New South Wales, Victoria and Western Australia. It lists competition from cropping and cattle among the pressures on the industry.

Key sheep farming areas in Australia

New South Wales and Victoria hold most of the flock. According to MLA’s Fast Facts 2025, NSW had 38% of sheep, Victoria 24%, Western Australia 17%, South Australia 15%, Tasmania 3% and Queensland 2%. These shares come from the MLA and Australian Wool Innovation producer survey and refer to a flock estimate at June 2024.

Chart

Share of the Australian flock by state

Percent of sheep; flock estimate at June 2024

For a dated look at state headcounts, the ABS counted 27.1 million in NSW, 14.6 million in Victoria, 12.4 million in Western Australia, 10.6 million in South Australia, 2.8 million in Queensland and 2.6 million in Tasmania at 30 June 2022. Treat those as a snapshot from that year, not current numbers.

Lamb and mutton output differ by state

Where sheep are counted and where they are processed are not the same thing. ABS data for 2024, reported by MLA, shows Victoria with 54% of lamb output, well above its share of the flock. NSW had 38% of mutton output and Victoria 37%.

Chart

State share of lamb and mutton output

Percent of national tonnes carcase weight, 2024; Queensland under 1% of each, not shown

What Australian sheep farms produce

Most operations sit somewhere on a line between wool and meat. A pure Merino flock earns more from the fleece. A crossbred or meat-breed flock earns mostly from lambs. Many mixed farms also grow crops, using sheep to graze pasture phases and stubble. A short video in this section explains why mixing enterprises can soften a bad year.

Lamb and mutton

In 2024 Australia produced 629,682 tonnes of lamb and 297,548 tonnes of mutton in carcase weight, according to ABS figures in MLA’s Fast Facts. Mutton is meat from older sheep. The numbers fell in 2025 and are forecast to fall again in 2026, yet MLA expects 2026 to be the fourth-highest lamb output year on record. Containment feeding and lot feeding are now permanent parts of the industry, says MLA, and they support heavier carcases and steadier supply.

Wool

Wool has regained some of its pull. The Eastern Market Indicator (EMI), the main Australian wool price guide, reached 1,890 Australian cents per kilogram in September 2026 after a June 2026 peak of 1,989 cents, MLA reports. Stronger prices for fine and medium Merino wool have helped slow the long drift away from Merino sheep. The producer intentions survey points to 10% more wethers in 2027, which MLA links partly to keeping sheep for wool. Wool prices move with each sale, so use the Australian Wool Innovation market pages for today’s figures.

Sheepskins and other products

Skins are a smaller income line and are reported separately in MLA’s saleyard market reports. Check those reports if skins matter to your budget.

▶ Why mixing livestock with crops can soften a bad year. · 2:55

Is sheep farming profitable in Australia?

It can be, but income swings hard from year to year. ABARES, cited in MLA’s Fast Facts, gives a national benchmark: average farm cash income for sheep producers was estimated at A$51,000 in 2023-24, down 44% on the year before. That was a weak price period. The same document gives industry turnover of A$9.1 billion in 2023-24 across 22,474 agricultural businesses with sheep.

Farm cash income is not the same as profit. It leaves out items such as depreciation and any change in stock value, so a farm can show cash in a year when it is selling down its flock. Check your own figures with an accountant or farm adviser before making a financial decision.

Prices are high, but so are costs

MLA describes 2026 prices across sheep, lamb and wool as historic and in some cases record-breaking. Its survey of outside analysts expects some easing by 31 December 2026, while staying well above long-term averages. These are forecasts of saleyard indicators in carcase weight terms, not farm-gate guarantees.

The cost side matters as much. MLA’s October 2026 report lists these pressures:

• Interest: the Reserve Bank cash rate reached 4.60% after rises through 2026.
• Diesel: national retail prices averaged 283 cents per litre on 27 September 2026, up from 177 cents on 28 June.
• Grain and hay: firm grain prices on strong export demand, with softer prices in places after autumn rain.
• Currency: the Australian dollar at US$0.72 in September 2026, which makes exports dearer for US buyers.

Sheep margin calculator

National averages will not tell you what your own flock can earn. Enter your numbers below to see the result after costs for a breeding flock in one year. The defaults sit close to break-even on purpose. They are examples only, so replace them with your own figures.

Try the numbers for your own farm below.

Exports and the markets that matter

Australia sells most of its sheepmeat overseas. Lamb exports reached a record 359,299 tonnes shipped weight in 2024 and mutton a record 255,090 tonnes, with combined value of A$5.2 billion. Greater China took 25.5% of sheepmeat exports that year, the US 17% and Malaysia 6.4%. Smaller supply cut those volumes in 2025, and MLA forecasts 331,000 tonnes of lamb and 135,000 tonnes of mutton in 2026.

Three market issues stand out in the October 2026 report:

• US tariffs: a 10% US tariff from April 2025 rose to 12.5% in July 2026. The US also opened a safeguard investigation into lamb imports from all suppliers in mid-July 2026. MLA’s October report said it was still under way and had not changed current trade terms.
• China: it remains the largest destination at 25% of sheepmeat exports, and was the top lamb market in July and August 2026.
• New Zealand: its flock fell 2% to 22.78 million in June 2026, which keeps world supply tight and creates openings for Australia.

The end of live export by sea

Live sheep export by sea is legislated to end from 1 May 2028, and the trade can continue without caps until then. Volumes have already collapsed. MLA forecasts just 35,000 head in 2026, mostly because conflict in the Middle East has disrupted shipping routes and safe access to ports, with high Australian sheep prices as a second factor. Producers who sell into this trade need a plan for other sale paths. Get advice on current rules from your state agency or your exporter.

Chart

Live sheep exports from Australia

Thousand head; 2026 to 2028 are MLA forecasts

Climate, drought and pasture risk

Rain drives this industry more than any other single factor. The Bureau of Meteorology reports a decrease of around 16% in April to October rainfall in the south-west since 1970, and around 9% in the south-east since 1994. It expects cool-season rain to keep falling on average across many southern and eastern regions, with more time in drought.

That matters because sheep supply rebuilds slowly. MLA estimates the flock lost almost 9 million head from 2017 to 2020, regained about 8 million by 2023, then lost around 10 million by 2026. Its concern is that a rebuild takes several years, and the next dry spell can arrive first. Practical steps it lists include:

• Protect core breeding ewes through a downturn where the numbers work.
• Use containment feeding to protect pasture and ground cover.
• Pregnancy scan and manage animals individually.
• Finish more lambs with lot feeding or supplementary grain.
• Use forward prices and supply contracts for more certainty.

The Queensland government’s guide to managing sheep in drought makes a similar point: prepare before the drought, be ready to reduce numbers by selling, agisting or culling, and manage sheep and pasture carefully after it breaks. Western Australia’s department also has guidance on stocking rates and water for livestock. If you are thinking about housing as part of a feed plan, one option is covered in our look at hoop barns for sheep.

Health, welfare and traceability rules

Worms are a large and steady cost. A report for Australian Wool Innovation cites an estimated A$435 million a year in losses to the Australian sheep industries, calling worms the costliest disease condition for producers (Lane et al., 2015). Flystrike and lice add to the workload. Business Queensland’s sheep health guide covers the main diseases and parasites. Follow the product label and local rules for any drench or chemical, and ask your vet about resistance testing.

Electronic tags

Under the national system, all sheep and farmed goats born on or after 1 January 2025 must have an approved NLIS electronic tag before leaving their property of birth, and visual tags are no longer accepted for those animals, according to Integrity Systems. Exemptions are a state matter, so check with your state government. Mixed mobs of tagged and older stock can move together on one NLIS transfer.

Shelter and lamb survival

Shelter can affect how many lambs survive. An MLA factsheet on trees on farms reports lamb mortality of 16% in a bush paddock compared with 25% in a nearby unsheltered paddock in one south-west Victorian study. That is one site, so treat it as a guide. For a wider view of environmental measures, the industry’s Sheep Sustainability Framework tracks performance against published indicators.

Technology on Australian sheep farms

Technology is useful when it answers a decision you already face. For sheep producers, these are common uses:

• Electronic tags and readers: required for younger stock, and useful for recording weights, ewe performance and sale data.
• Pregnancy scanning: lets you feed twin-bearing and single-bearing ewes to their needs.
• Remote water checks: reduce long trips to tanks and troughs on large properties.
• Satellite pasture maps: vegetation indices such as satellite NDVI show how green cover changes across paddocks over time. They do not count sheep or name the cause of a change, so you still need to walk the paddock.

The Farmonaut Satellite + AI Farm Monitoring System is one way to view those maps for your own paddocks, on the web app or the mobile app. A video in this section walks through reading the satellite data.

▶ How to read satellite data in the Farmonaut web app. · 10:16

How to start sheep farming in Australia

If you are new to the industry, work through these steps before buying stock. Our guide to starting a small sheep farm has more on the first year.

1. Choose the product. Decide on wool, lamb or both, because this sets your breed, shearing and sale calendar.
2. Check carrying capacity. Base stock numbers on your dry-year feed, not your best season. Your state department’s stocking rate guidance is a good start.
3. Plan water. Budget for summer and drought demand on every paddock.
4. Register and tag. Get a Property Identification Code from your state and buy approved electronic tags for animals born on your place.
5. Set a health plan. Talk to a local vet about worm testing, vaccination and flystrike timing.
6. Budget for a dry year. Run the calculator with lower prices and a lower lambing rate, and check how your interest bill looks at today’s rates.
7. Line up buyers. Know your saleyard, processor or wool broker before your first turn-off.

▶ Six plain steps to start using precision farming tools. · 4:18

What to watch in sheep farming in Australia

• Season: the Bureau’s outlook cited by MLA pointed to drier conditions in southern NSW, much of Victoria and Tasmania for October to December 2026, with a strong Pacific warming pattern in place.
• Ewe retention: high prices tempt producers to sell the females needed for the rebuild.
• Processing capacity: lower throughput and higher fixed costs put pressure on plants, and MLA flags a risk of rationalisation.
• US trade decision: the outcome of the safeguard investigation will decide whether new measures follow.
• Merino or meat: the wool-to-lamb price gap will shape which sheep producers keep.

FAQ

How many sheep are there in Australia?

MLA estimates about 64.2 million head at 30 June 2026, and forecasts about 68 million by June 2028. Older figures such as 79.1 million for June 2024 used an earlier basis, so compare only within one series.

Which state has the most sheep?

New South Wales, with 38% of the flock in MLA’s Fast Facts 2025, followed by Victoria at 24%, Western Australia at 17% and South Australia at 15%.

Is sheep farming profitable in Australia?

Results vary widely by year and farm. ABARES estimated average farm cash income at A$51,000 in 2023-24, a weak year, while MLA describes 2026 prices as historic. Costs such as interest and diesel have also risen, so test your own budget.

Why is sheep rearing important in Australia?

It earns export income: sheepmeat exports were worth A$5.2 billion in 2024, and around 197,512 people work directly across the wider red meat and livestock industry, according to MLA, which also counts cattle in that figure.

When does live sheep export end?

Live sheep exports by sea are legislated to end from 1 May 2028. The trade can continue without caps or quotas until that date, although volumes are already very low.

Do all sheep need electronic tags?

Sheep and farmed goats born on or after 1 January 2025 need an approved electronic tag before leaving their property of birth, unless a state exemption applies. Integrity Systems’ transfer guidance says animals born on or after that date must carry the electronic tag, and state plans differ, so check yours.

Related pages on our site: product traceability, carbon footprint tracking, farm vehicle tracking, satellite checks for loans and insurance, satellite data API, API developer documents and asset management planning.