Agents say upgrades to the Eastern Victorian Livestock Exchange at Bairnsdale will improve animal welfare and attract livestock vendors from further afield.
Last week East Gippsland Shire Council announced the contractor for the $1 million project, which includes roofing, soft flooring and multi-species pens.
Landmark East Gippsland livestock manager Brad Obst backed the upgrades and said the redevelopment of the sheep pens would bring the exchange into line with other livestock facilities.
"The old sheep yards were very run down and I think the council has taken an approach that is very responsible in that it won't be just single species, it'll expand our room for cattle and improve and expand the sheep selling facilities," he said.
"Having multi species pens gives us the ability on the larger cattle sale days to present the cattle in a more favourable manner and for sheep it'll bring it into line with some of the other facilities that are being upgraded."
The project includes a new draft and delivery areas, which will both be undercover, new loading ramps, LED lighting and water troughs, with stormwater collected from the roof at the facility to be reused.
"It will certainly help increase our capacity for our store sales and unfortunately with the dry conditions we have been attracting a lot of stock out of the Monaro area so it'll help increase our options to display the stock on those larger days," Bairnsdale Stock Agents' Association president Gerard Ogilvie said.
"It's good to see that the shire is supporting the industry in the area.
"With the soft floor and the roof, it'll enhance the welfare of livestock, replacing what used to be a concrete floor making it more friendly on days of extreme heat or wet weather."
East Gippsland Shire mayor Natalie O'Connell said the improvements followed extensive consultation with stakeholders including livestock agents, transport companies and vendors.
"The roof and soft flooring will improve conditions for the animals, however, being undercover will also be more comfortable for buyers," she said.
"The soft flooring will eliminate the cost and the labour needed to wash down the existing hard floor area.
"We will also make the most of the new roof by capturing the stormwater and reusing it in the facility."
A completion date for the project is yet to be set, however, demolition of the old yards was recently completed.