Agenda ignores rationale says analyst

This newly-stated, five-year length has aligned the response with the minimum length of time in the medium option as explained in the Episode 3 report.

Episode 3 founders and market analysts Matt Dalgleish and Andrew Whitelaw were contracted by the government to provide an analysis of markets involved and provide a detailed report that covered key terms of reference the Independent Panel was tasked with including, the Episode 3 report was titled: Phasing Out Live Sheep Exports from Australia strategies to target minimal impact upon farmers and supply chain participants.

Mr Dalgleish said to backdate the start date of the phase-out was putting unnecessary pressure on an industry that would likely be decimated by this decision and would not be enough time.

"That seems ambitious to me," Mr Dalgleish said.

"It's rubbish to say that what they ask can be done in such a quick time, plus they said they wouldn't be legislating it in this term of parliament and our work was on the premise that the phase-out would not commence until 2025."

The analysis of industry stakeholders showed the government's recently proposed transition support package failed to deliver a viable timeline to minimise the impact of shutting down the live sheep export trade to Western Australia's sheep industry.

"The optimum time as recommended by our consultation with industry and market analysis showed that an eight to 12-year timelime would be the most appropriate timeline as it was sufficient to implement the adjustments required," Mr Dalgleish said.

The Department of Agriculture, Fisheries and Forestry has stated on their website that the phase-out is over five years to finish on May 1, 2028, which is different to the four years Federal Agriculture Minister Murray Watt announced on May 11.

"The Australian Government has committed $107 million over five years for sheep producers and the supply chain to plan for and adjust to the phase out," DAFF said.

"Early action is being encouraged by the provision of funding now.

"We want to ensure those affected by the phase out are well-positioned, resilient and ready when the trade ends in 2028."

Mr Dalgleish said they were asked to supply a shorter timeline as an alternative timeframe and hence their inclusion of the five to eight year phase-out in their report, but he said they seemed to want as short a time as possible.

"They also then asked us to provide the same data for a two-year phase-out and we said it was not possible on the premise that the costs of compensation would be too extreme," Mr Dalgleish said.

"The current timeframe is not five years and it is not the four years as announced last week either, you will be lucky if it's three years.

"It doesn't start in 2025 because they said they were not legislating in this term of parliament.

"This short timeline is ambitious and won't work for many reasons."

Mr Dalgleish said responsibility for the timeframe given for the phase-out was with the Independent Panel and their report, because Episode 3 was worried on the premise the phase-out timeline would commence in 2025, while the panel backdated this to the announcement of the Independent Panel's appointment on March 3, 2023.

"A medium-term transition in mid-2028 seeks to balance the interests of all stakeholders and aligns with some calls to end the trade in five years (if counting from the time of the panel's appointment)," said the Independent Panel's report on page 169.

The panel considered that this time frame provides animal welfare advocates with certainty about the end of the trade, alongside assurances that animal welfare protections remain in place during the transition period.

"Recognising the large numbers of stock on farms in WA at the time of the panel's consultations, ending the trade in mid-2028 allows for these stock to enter live export or slaughter pathways, and gives time to manage breeding decisions ahead of the cessation," the report said.

"Producers will have enough opportunity to plan and adjust their businesses before the end of live sheep exports by sea.

"In the interim, live export by sea remains a turn-off option for current stock, helping address the existing backlog.

"The panel also considers that this end date provides time for producers to commence sheep flock or genetic changes to be more targeted at sheep meat.

"The high numbers of lamb being processed in WA indicates that this shift to meat production is already occurring for some producers."

Onshore processing and the boxed meat trade is the Federal government's answer to replacing the substantial gap left by ending live sheep exports by sea, but this solution is not possible according to Mr Dalgleish.

It is known that meat processors in WA have faced issues including lack of skilled labour, lack of housing, inadequate cold storage space and require expansion to be able to increase capacity.

Mr Dalgleish said their consultation with the processors in WA highlighted these factors and contributed to their timeline considerations.

"All operating abattoirs in WA plan to expand in the future, with expansion timelines projected to span between three to five years," the Episode 3 report said.

"The current estimated combined full capacity for WA processing for sheep and lamb is 106,000 head per week, equating to approximately 424,000 per month.

"Under ideal conditions (unlimited labour and optimal logistics), potential WA processing capacity for sheep and lamb could increase to 140,000 head per week, or 560,000 head per month."

Mr Dalgleish said the phase-out of live sheep trade would affect the supply chain, with many participants' transition requirements depending on key supply chain adjustments.

Industry consultation undertaken by Episode 3 on lamb feedlot expansion, processor capacity development, and logistics could take between three to six years, assuming no significant delays.

Mr Watt has come out this week and said there will be no adjustments made to the length of the phase-out, even though recommendation 23 of the government's response said:

A review should be conducted in 2026 to ensure farm businesses, the WA sheep supply chain and market development are on track to achieve the onshore processing of the WA sheep turnoff expected by the cessation date for live sheep exports by sea.

This review should include recommendations about any adjustments needed, any change to the timeline and further actions to support a smooth transition by individuals, businesses and communities.

"I think this is a really positive package for the farming industry in WA going forward," Mr Watt said.

"Just as other States have made the transition to onshore processing, I am confident that we can do it.

"Other States did it without taxpayer support, that is actually being provided here in WA to make this work.

"There are obviously exports that happen via air, increasingly they are happening by ship though - of sheep meat.

"One of the things we were able to achieve last year was reaching an agreement with Gulf States which extended the period of wrapped processed meat

"There is absolutely no limit on air freight flights to Qatar, so that can happen now, it's not capped, they can have more if they want to."