RISING lamb prices and farm incomes in the past three years have encouraged slaughter lamb producers to boost sheep numbers and invest in farm capital.
That's a key finding of a new report by the Australian Bureau of Agricultural and Resource Economics, Australian Lamb: Financial Performance of Slaughter Lamb Producing Farms, 2007-08 to 2009-10.
According to the report, slaughter lamb producers are expected to enjoy a farm cash income, on average, of $109,700 per farm in 2009-10, 4 per cent higher than the previous financial year's result.
Large producers selling more than 2000 lambs for slaughter have done best, averaging farm cash incomes of $186,700 per farm.
This was because they focused on producing heavier lambs targeted at the premium slaughter market, the report said.
Producers who sold lambs directly for slaughter and to live export markets earned higher farm cash income per hectare than producers selling lambs to feedlots or other producers.
Producers using grain to finish lambs for sale also averaged much higher incomes per hectare than others.
In 2008-09, slaughter lamb producers invested, on average, about $123,000 per farm on new capital, according to the report. The main focus was land purchases, but plant and machinery investment was increasing sharply.
