Flock forecast to rise in 2026

After two record breaking years of sheep and lamb production, supply has already started to slightly contract so far in 2026. There are plenty of questions being raised about where the Australian sheep flock and subsequent lamb numbers currently sit after another year of tough weather conditions in much of the production area. What there is not a lot of are answers to those flock size questions. The Australian Bureau of Statistics has not released an official Australian sheep flock number since 2022. Let us look back at some of the data we do have to gauge sheep supply heading into 2026.

The national sheep flock size was estimated to be 74.2 million head as of June 2025, more than 6% lower than the previous year. The forecast is for that figure to climb back up 2% in 2026 to 75.6 million head. This would be on the back of sheep slaughter falling 15% from 2024 to 2025 and a further 18% this year. National Livestock Reporting Service weekly figures have mutton kill for 2025 at its second highest figure on record, averaging about 13% lower each week than in 2024.

ABARES September Agricultural Commodities Report had the Australian sheep flock at 65.4 million head in 2025-26, which would be a rise of 1% on the previous financial year. They predict mutton production to fall by about 26% in 2025-26 as the flock begins to rebuild. The MLA/Australian Wool Innovation Sheep Producer Intention Survey from October reported the lamb flock size would increase 11% from 2025 to 2026 to 31.09 million head, with 52% of respondents planning to increase their sheep numbers, most on the back of improved lambing results and increased ewe retention.

That survey also expected the total 2025-26 lamb sales to be nearly 1.5 million head higher than the previous season, with 44% of the 23.87 million head to be sold in the first half of 2026. However, national lamb slaughter was forecast by MLA to reach about 24.85 million head in 2025, falling below both 2024 and 2023 levels. Weekly NLRS figures totalled just shy of 21 million head, averaging 402,000 head a week; a drop of about 10% from the 2024 weekly average, but still 4% above the five-year figure. The September industry projections have 2026 lamb slaughter falling further to 24.31 million head, a dip of 2%.

We have only got one full week of figures so far in 2026 when it comes to slaughter, but for sheep that was 33% lower year-on-year and 16% below the five-year average for that week. Lamb slaughter was only down about 2% on the previous year, which lowered the combined total sheep and lamb slaughter by nearly 12% year-on-year.

What does it mean?

Putting aside the weather, two competing factors could influence the potential rebuild stage for the Australian sheep flock. The first being current flock numbers; anecdotally some industry estimates are much lower than the official figures we do have, believing the last two years of high turn-off and lower lambing percentages could have eaten into the flock more than we think. The second being the mutton market and its impact on sheep slaughter; the national indicator has climbed higher again this week and sits at more than double the same time last year.