Australia is the world’s largest exporter of sheepmeat and will continue to be so in 2026, despite a further fall forecast in the sheep flock.
Meat and Livestock Australia (MLA) this week released its 2026 forecast and it estimates that the flock will fall by 2.7% this year by 30 June to 67.1 million head.
The number of lambs slaughtered this year is predicted to fall by 11% to 21.86 million, which is in addition to an almost 7% decline in 2025.
The slaughter of older sheep for mutton is expected to fall by a sharp 30% to 7.13 million this year.
This means that Australia will produce less sheepmeat this year. The volume of product is expected to fall by 10% for lamb to 537,000 tonnes.
This is slightly less than the fall in lamb numbers processed because carcase weights are forecast to increase to 24.6kg. While this is a decline on the record highs achieved in recent years, it still reflects one of the stronger production years overall due to productivity gains.
Outlook
Looking further ahead, MLA is forecasting the national sheep flock to continue its decline.
In 2027, it estimates that numbers will fall by 1.2% to 66.4 million and in 2028 by a further 2.7% to 64.6 million, the lowest level on record.
The sharp fall in slaughter numbers this year isn’t expected to be replicated in the following years, as more sheep are retained for breeding.
MLA foresees mixed conditions for Australian sheepmeat in 2026, with tighter supply expected to limit export volumes.
On the other hand, it highlights reduced global availability, with constraints on the New Zealand flock, supporting underlying demand from international markets.
It also flags that “higher livestock prices, freight costs and currency movements are expected to influence competitiveness and trade flows through the year”.
Feedlot development
MLA highlights the growth in specialised finishing feedlots in the Australian sheep industry, with almost a quarter of stock spending 35 days on gain feed prior to slaughter.
It also suggests that high prices squeezed processor margins in 2025 and the national heavy lamb indicator price is forecast between AUS$10.23/kg and $12.12/kg (€6.12/kg and €7.26/kg).
Comment – Australia remains key global player
Australia and New Zealand will continue to dominate global beef trade in 2026, even if their supply is more constrained than it has been in recent years.
Both countries have developed strong export markets to North America and China, as well as other Asian countries, and are less dependent on Europe than they were historically.
However, trade deals now in place with both the UK and EU makes access to these markets easier and leave them ideally placed as an option for their exports.
The decline in UK and EU production which has also occurred in Ireland in recent years means that demand from Europe could also increase in 2026 for sheepmeat imports.
Read more
EU-Australia deal increases market access
Australia’s beef production forecast to increase in 2026
Australia is the world’s largest exporter of sheepmeat and will continue to be so in 2026, despite a further fall forecast in the sheep flock.
Meat and Livestock Australia (MLA) this week released its 2026 forecast and it estimates that the flock will fall by 2.7% this year by 30 June to 67.1 million head.
The number of lambs slaughtered this year is predicted to fall by 11% to 21.86 million, which is in addition to an almost 7% decline in 2025.
The slaughter of older sheep for mutton is expected to fall by a sharp 30% to 7.13 million this year.
This means that Australia will produce less sheepmeat this year. The volume of product is expected to fall by 10% for lamb to 537,000 tonnes.
This is slightly less than the fall in lamb numbers processed because carcase weights are forecast to increase to 24.6kg. While this is a decline on the record highs achieved in recent years, it still reflects one of the stronger production years overall due to productivity gains.
Outlook
Looking further ahead, MLA is forecasting the national sheep flock to continue its decline.
In 2027, it estimates that numbers will fall by 1.2% to 66.4 million and in 2028 by a further 2.7% to 64.6 million, the lowest level on record.
The sharp fall in slaughter numbers this year isn’t expected to be replicated in the following years, as more sheep are retained for breeding.
MLA foresees mixed conditions for Australian sheepmeat in 2026, with tighter supply expected to limit export volumes.
On the other hand, it highlights reduced global availability, with constraints on the New Zealand flock, supporting underlying demand from international markets.
It also flags that “higher livestock prices, freight costs and currency movements are expected to influence competitiveness and trade flows through the year”.
Feedlot development
MLA highlights the growth in specialised finishing feedlots in the Australian sheep industry, with almost a quarter of stock spending 35 days on gain feed prior to slaughter.
It also suggests that high prices squeezed processor margins in 2025 and the national heavy lamb indicator price is forecast between AUS$10.23/kg and $12.12/kg (€6.12/kg and €7.26/kg).
Comment – Australia remains key global player
Australia and New Zealand will continue to dominate global beef trade in 2026, even if their supply is more constrained than it has been in recent years.
Both countries have developed strong export markets to North America and China, as well as other Asian countries, and are less dependent on Europe than they were historically.
However, trade deals now in place with both the UK and EU makes access to these markets easier and leave them ideally placed as an option for their exports.
The decline in UK and EU production which has also occurred in Ireland in recent years means that demand from Europe could also increase in 2026 for sheepmeat imports.
Read more
EU-Australia deal increases market access
Australia’s beef production forecast to increase in 2026
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