To feed or not to feed

THE big sheep sell off has begun, with a massive unloading of stock underway – about one to two months ahead of last year’s big destocking.For many, all-time record grain prices mean feeding sheep just doesn’t add up.But for those who can justify it, it could put them in a box seat when a decent seasonal break finally emerges.Holmes and Sackett consultant at Wagga Wagga, NSW, Sandy McEachern, said across much of south-eastern Australia feed on hand was far better than this time last year. “The pastoral areas are certainly in a bad state as are the midlands of Tasmania but with many growing grazing cereals this year things are not as bad,” Mr McEachern said.“That said many are clearly choosing to sell all sheep except breeding ewes.” Under a best case scenario, Mr McEachern said producers would not have to start supplementary feeding until January.Given a decent break next year that would equate to $30 to $40 per head on feed but with a wool clip of $20 and a mutton value of $20 the breakeven replacement price would be $40 in 2008.“You won’t be selling ewes for less than $50 next year, so if you can afford to hang onto ewes it may well be worth doing so, particularly given the market has already moved and Merino ewes are now at $20 and could be as low as $5 a head within a couple of weeks.”At $400 a tonne for barley, West Australian consultant Kevin Bell said wool had to be at $15 a kilogram to make it worthwhile.This week the eastern market indicator was sitting just above $9/kg.Dr Bell said producers were looking to exit the sheep industry in the grain belt of the west but in the south of that state the season was still very good.“Stubbles will be very important this year – many are looking to simply destock to an essential number of ewes and run them extensively on minimal feeding.”He added that lupins at $425/t represented much better value for those looking to feed stock on stubbles.NSW Department of Primary Industries livestock officer at Yanco in the Riverina Geoff Duddy said producers were faced with a lack of feed options.“Even with those alternative feeds such as grape-marc, carrots and even pumpkins the water hasn’t been there to grow them,” Mr Duddy said.“Baled crops might get minimal stock through until Christmas. Mind you it is worth keeping in mind that grain always gets cheaper at harvest time.”Dubbo, NSW, based consultant Graham Peart said across his territory sheep producers were running a third to a quarter of normal stocking rates with crops not high enough to cut.Principle Focus managing director Sean Martyn said his consultancy had bucked the trend, by suggesting farmers turn off stock well ahead of time, to supplement feed stock only for the goal of turning them off and never for maintenance. “One of our key principles is to always match stocking rate with carrying capacity and if you have to feed, do it for production, not maintenance,” Mr Martyn said.“History says you run into big problems when you feed to just keep animals alive.”For those who are thinking of how to manage the next six to 12 months, he said it was important that people take stock of their situation and control it rather than letting it control them.