DESPITE consensus that input costs will go up and workforce shortages will continue to be a hurdle, almost half the country's sheep producers are planning to increase the size of their flock over the next year, an in-depth look at farmer intentions shows.
That suggests there will be an additional 1.7 million lambs on the ground, over and above the 2022 flock size, or a jump of 6 per cent.
The Sheep Producer Intentions Survey, commissioned by Meat & Livestock Australia and Australian Wool Innovation, interviewed close to 2000 sheepmeat and wool producers.
It found 46pc of producers are looking to increase their flocks in 2023 with 60pc hoping to expand operations.
A deliberate growth strategy and the expectation of good season conditions were the two driving factors of increased stock numbers.
The threat of a foot and mouth disease outbreak has had reverberations but does not appear to be blocking expansion plans.
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MLA market analyst Jenny Lim said sentiment around the sheep meat business was clearly very positive.
"The intentions around flock size increase shows extreme confidence in the market, considering the headwinds affecting supply chains at the moment," she said.
The results show producers are cautiously optimistic about the future of the wool sector but far more buoyant about sheepmeat.
Ms Lim said analysts did think FMD might have a bigger impact on future intentions than it has.
"But prices this year have been very good, even though they have come back off the peaks, and conditions moving forward are promising," she said.
"That all supports the flock rebuild moving into its next phase."
The survey, formerly known as the Sheepmeat and Wool survey, has been revamped, allowing for far more information to be drawn.
One insight was that physical saleyards continue to be the dominant sales channel for producers.
Specifically, 58pc of producers said that saleyard auctions were the main channel used, with over-the-hooks sales the second most used method at 23pc.
Ms Lim said that was seen as a good sign, given discussion about how valuable saleyards were to rural and regional communities.
NSW has the strongest saleyard usage with 73pc of producers using this channel for sheep and lamb sales.
Larger producers with 10,000 or more sheep are more likely to use direct sales.
"The results show saleyards are still a popular sale method - it is those producers who need to shift very big numbers who are going direct to processors and using forward contracts," Ms Lim said.
The new format also allowed for a deeper understanding of the breed makeup of the flock.
"With Merinos making up 40pc of the total lamb flock and prime lambs at 35pc, the challenges around costs and labour seem to have less of an impact on decision making around flock growth than may have been previously expected," said Ms Lim.