New Zealand sheep population drops to 23 million

photo: New Zealand beef and lamb

Drought and continued low lamb returns have caused sheep numbers to fall again, with the knock-on effects being felt in rural communities across the country.

The latest sheep stock survey by Beef & Lamb New Zealand showed sheep numbers were down 4.3 per cent year-on-year to 23.31 million at the end of June.

The number of breeding ewes fell by 2.9 per cent, while the number of breeding lambs fell by 7 per cent.

Sheep numbers have continued to decline over the past decade.

The report said in previous years the main driver was land use change, as sheep and cattle farms were converted to woodland. This year, the main drivers were low sheep prices and drought in parts of the country.

“This has resulted in farmers needing to destock and has had an impact on the outlook for next season’s lamb production.”

Lamb prices collapsed last year as weak demand from China and Australia flooded the market with more lamb – and that, combined with rising input costs, has left many sheep farmers on track to make a loss this year.

“Livestock that would have been wintered were sold to improve cash flow, and in addition, capital livestock were sold to increase income – the loss of capital livestock will reduce lamb and calf production in the spring of 2024 and impact potential income going forward,” the report said.

Canterbury and Marlborough, which have been experiencing drought, saw the biggest drop in sheep numbers at 12.2 per cent.

In the driest areas such as Nelson and North Canterbury, it is common for sheep flocks to be reduced by 30%-60%, and in extreme cases, entire ewe flocks are being sold.

Huge traffic impact

In recent weeks, Radio New Zealand has reported on job losses at a Waitaki meat processing plant which is struggling to keep enough stock, while shearers are seeing less work due to a drop in sheep numbers.

New Zealand Beef and Lamb president Kate Acland said the knock-on effects would continue as sheep numbers showed no signs of recovery.

“The lamb and beef industries generate around $11 billion in revenue for New Zealand and support 90,000 jobs across agriculture and processing, and we know lamb and beef farmers spend the majority of their money in rural communities.

“So we’re seeing a lot of rural communities being impacted, we’re seeing reductions in veterans and services, we’re seeing local schools closing or losing teachers, so the impacts have spread across much of the country.”

Ackram said many sheep farmers have found part-time work, selling their lamb to carbon sink forestry, or have switched to cattle farming, which currently offers higher returns.

“Unfortunately we haven’t seen anything to suggest that things are going to get dramatically better, I mean, in the beef and lamb industry, what we really try to focus on are the factors that farmers can control on the farm, and that’s what’s really going to improve productivity and profitability.

“But we are concerned about the critical mass of the industry, you know, the sheep and beef industry is the economic driver of our country, it supports biodiversity and those iconic mountain landscapes, so it’s really important that we rebuild profitability and confidence in the industry.”

The number of beef cattle has also declined

photo: RNZ/Carol Stiles

Despite the good performance of beef prices this year, the beef cattle population fell 2.8% to 3.55 million head at the end of June.

The Beef and Lamb Council report said the drop in production was mainly due to a reduction in livestock due to drought in the South Island.

As of June 30, 2024, the number of breeding cows has declined in most regions, as has the number of older, heavier trade cattle.

The report states, “One possible reason for the decline in the number of old bulls in the herd as of June 30 is that the profit margins for calf raisers were very slim two years ago, resulting in a shortage of calves available for processing in the current market, which in turn led to a reduction in the number of calf raisers.”

As with the decline in sheep numbers, Canterbury and Marlborough recorded the biggest falls in cattle numbers, down 10.7 per cent, due to reduced feed levels caused by the drought.