THE WA sheep industry has had a fantastic year if we look at demand and associated prices.
During 2020 sheep producers have been lucky that demand from the Eastern States coincided with their need to offload due to water deficiencies and a lack of grazing pastures.
WA has seen the biggest exodus of lambs and adult sheep depart the State since 2010 - surpassing the record of 1.07 million head by nearly double.
While all the figures are yet to be finalised, as at the end of November a total of 1.8m passed through the Ceduna Checkpoint according to the Department of Primary Industries and Regional Development (DPIRD).
"It has been a record breaking year for the movement of WA sheep to the Eastern States," said DPIRD research officer Kate Pritchett.
"Between January and November 1.8m sheep and lambs have been transported east, almost double the prior record of 1m from 2010.
"Lambs have made up 55pc (990,700) while adult sheep have made up the remaining 45pc (816,900)."
Corrigin sheep producer Steven Bolt said he was surprised by the number of ewe lambs and adult ewes that had been loaded onto trucks.
He said a long-time sheep farmer in his district had just destocked this year to go full cropping - removing more than 2000 ewes out of the system.
Mr Bolt said the impact on the industry would be felt next year if numbers continued to be sent east.
Younger farmers in the Lakes District around Kukerin and Lake Grace also took the opportunity to cash in on the demand and sell out of sheep entirely to go full cropping - destocking thousands of sheep out of the area.
Agents and livestock transporters were concerned by the number that had gone out of the area and the affect this would have on the industry going forward, especially the effect on associated industries such as shearing and local transporters.
Nutrien Ag Solutions region livestock manager - WA Leon Giglia said the number of sheep heading east this year "does concern me".
"The breeding flock is in decline," Mr Giglia said.
"I would have thought this year would have been stable if not for the east coast restocking to the extent they did.
"With so many sheep sold off in the Eastern States due to the drought there was going to be a day when they did restock but I didn't expect them to be so aggressive.
"Next year we might see it come back to normality but there will always be regular purchases and repeat buyers still active in sourcing from WA."
Mr Giglia said sheep producers had been carting water for more than 12 months in some areas due to a lack of on-farm water but this year the storage capacity had been "completely exhausted".
"You can understand and accept complete destocking in some areas due to the lack of water," Mr Giglia said.
"The decisions were made to totally destock from a lack of water because they didn't want to go through another summer doing that."
Elders State livestock and wool manager Dean Hubbard said "price wise the year couldn't have been better" but it had been a "very disruptive year".
He said feed and water pressure the past few years had impacted livestock producers and it was still affecting decisions to hold on or sell off stock.
"We need a good season going forward and good marking rates," Mr Hubbard said.
"We need to try and get some sheep back onto paddocks in WA."
Mr Hubbard said Statewide the numbers of sheep that had been exported, processed or sent east were 870,000 more than the same time last year, and in 2019 there were 600,000 head "oversold" on the previous year.
He said that meant the State's flock numbers were "about two million sheep down" on two years ago.
"One would think we are at critical mass at the moment for sheep," Mr Hubbard said.
"If prices maintain where they are it might encourage people to get back into livestock."
Mr Giglia said it would be interesting to see how the lamb market shapes up with changes in the market due to the Qatar government's announcement in early December to no longer subsidise imports, and what impact that would have on airfreight lamb.
"It's a 'watch this space' with the sheep market," Mr Giglia said.
The total number of sheep put through a saleyard in WA from July 2019 - June 2020 was 1.2 million head, down 9pc on 2018-19.
Katanning put through 703,996 head - 55.8pc of the total while Muchea had 558,544 head.
Mr Hubbard said Elders had taken on using AuctionsPlus a lot more this year to attract a wider national clientele, which had worked well for the company.
"There's been a spike in demand from the Eastern States - but will that continue?" he said.
"It depends on the seasons in New South Wales and Victoria as well as in WA."
It made for a wait and see scenario.
Ms Pritchett said the total sheep and lamb slaughter for WA reached 2.8m head between January and September 2020, down 3pc compared to the same time in 2019.
Of the total, adult sheep made up 39pc or 1.1m head.
"This was the highest seen since 2009 and a 2pc increase compared to the same time in 2019, which was also a strong year," Ms Pritchett said.
"Lamb slaughter, accounting for 61pc of the total, reached 1.7m and was down 6pc year on year.
"Despite the reduction in total slaughter, total sheepmeat production remained on par with 2019, reaching 64.6 million kg (mkg).
"Of that 26.7mkg was mutton and 37.9mkg was lamb."
DPIRD said in the first 10 months of 2020, total sheepmeat exports reached 61.2mkg (carcase equivalent quantity (ceq)), down 5pc on 2019, but still easily the 2nd highest on record.
"Mutton exports have reached 32mkg (ceq), down 3pc compared to the 33mkg (ceq) of 2019, while lamb exports reached 29.2mkg (ceq), down 8pc year on year," Ms Pritchett said.
"Despite the reduction in mutton exports by volume, the value increased 8pc year on year to $197m and the highest on record for this time of year.
"The value of lamb exports reached $249.9m, down 6pc year on year, but still the 2nd highest on record.
"Combined sheepmeat exports have reached $446.9m so far in 2020.
"To date in 2020 the largest market for sheep meat from WA has been China, which accounted for 41pc of the volume of sheepmeat exported (25.3mkg (ceq)) and 35pc of the value ($158.4m).
Qatar and the United States were the next largest markets for WA sheepmeat.
Mr Giglia said the sheep meat market had stabilised and was very "solid".
"I don't think we will see significant rises or dips in lamb and mutton," he said.
Mutton was sitting around 460c/kg-520c/kg, depending on weight and lamb was averaging 660c/kg over the hooks on December 11, according to Meat and Livestock Australia.
Last year those prices were at the high end of the scale and now they seem like the average.
In the lead up to Christmas, Katanning sheep producer Rod Bushell said he received 580c/kg for mutton over the hook and put it down to "a supply and demand thing".
"Supply is pretty tight and it usually dictates prices," Mr Bushell said.
He said there was "nothing worse than having to offload sheep and the money was terrible".
Mr Bushell said the saleyard market was still strong at Katanning and the processing industry was expecting things to tighten up around February/March because people had offloaded early due to the demand and prices.
"As long as the produce can be sold at supermarkets the prices should be able to be maintained," Mr Giglia said.
Mr Giglia wasn't too concerned about the viability of the processing industry because "processors adapt their businesses to suit - they'll work through it".
"If we have an average to better season next year I don't see much changing," Mr Giglia said.
Mr Hubbard said processors had had a difficult time through the COVID-19 period and had been under pressure to secure staff to fill positions and increase throughput.
"They have coped exceptionally well considering but the numbers are down," Mr Hubbard said.
On another positive note, the WA ram sale season was the third best on record despite the seasonal conditions and the impact of COVID-19.
The average across all breeds was $1474, and the gross total was $19.9 million.
For the live export trade, between January and October 2020, 653,900 sheep have been exported, down 12pc compared to the same period in 2019.
Ms Pritchett said despite this, the value of live exports had increased 2pc year-on-year from $101.2m to $102.9m in 2020 off the back of very strong prices.
She said the biggest market for live sheep remained Kuwait, which accounted for 45pc of the number of sheep and value of sheep exported live, followed by Qatar and Jordan.
These three markets accounted for 83pc of WA's live sheep exports in 2020 (so far).