Sustained returns to drive SA's Merino ram sale season

RELATED: Merino ram sale success defies dry times

Last year, many Merino studs notched up impressive $1800 to $2500 averages and agents are expecting more of the same - or even slight increases - when ram sales kick off next week.

The wool market has come off its heady heights seen about this time last year but many woolgrowers are still very pleased to be pocketing between $2200 and $2500 a bale.

And with lamb and mutton breaking records almost weekly, industry confidence is sky high.

Elders SA studstock manager Tony Wetherall expects near total clearances for most SA Merino studs' sales, other than those heavily reliant on pastoral orders, and says some could even eclipse their 2018 sale averages.

"We have had a reasonably good start to the season in most of the agricultural areas and people have cashed in on good wool and sheep prices. The optimism is very high for 2019 but also the coming years in front of us," he said.

"They (buyers) will have a budget but they will not hold back for rams they want so we may even see averages go up a bit."

Mr Wetherall says some of the terminal sire ram sales later in the season may not fare as well with the sell-off of ewes in the Mid North, Mallee and into the pastoral areas, due to the long dry, plus the emphasis on breeding more Merinos during the flock rebuild.

"Below Keith in the South East, which was not affected by drought, there should be little effect and with lambs making $300-plus people will not be afraid to invest in their genetics," he said.

"But in those other dry areas where people have sacrificed their old ewes which would normally be joined to a terminal sire, the demand will be less," he said.

Border Leicester sales should also be strong on the back of the tremendous demand for first-cross ewes and the Dohne and Prime SAMM sales would be similar, having found their supporters.

Landmark SA stud stock manager Gordon Wood says with wool and meat commodity prices "so good for so long", a repeat of last year's results was on the cards, or even a slight lift in average at some sales.

There was plenty of positivity in the sheep industry but he said the biggest apprehension for many commercial breeders was the season.

"Anyone that has sheep or has had sheep is keen to grow their numbers but there are a lot of obstacles in people's way, it comes down to feed and water, and in the pastoral areas we have seen thousands of ewes gone," Mr Wood said.

"Where things will be tight is those pastoral orders, particularly the private sales where they take 50 to 100 rams - that business will not be there."

Given the difficult season, Mr Wood commended breeders on how they had presented their Merino rams with many he had inspected bigger and heavier than 2018, although there was more dust penetration in the wool due to the season.

"The bodyweights of a lot of the rams are five kilograms to 10kg heavier than last year's offering due to a lot more supplementary feeding - pasturefed was not an option for many," he said.

Mr Wood expects buyers will keenly chase rams with heavy fleece weights but also high early growth, muscle and positive fat.

"There is no doubt buyers have been chasing wool cut for a few years now but at the same time when they are looking at $10/kg for lamb and $6/kg for mutton, it is a really good option to chase a multi-purpose animal which the Merino ticks the boxes for nowadays," he said.

Mr Wood again expects diminished demand for terminal sires in mixed farming areas but plenty of strength for Poll Dorset, White Suffolk and Suffolk sales in the high rainfall areas, where averages could lift again.

SPALDING-based Poll Merino breeder Daniel Hammat is feeling confident ahead of his Baderloo stud's inaugural auction next month, especially with the season "as good as it could be".

"It is an amazing time to be in the Merino industry," he said.

"We are about to look at selling our cull rams, which are worth about $250 each, and the prices we have got for wool have been just fantastic.

"For a stud like ourselves that is focused on the profit drivers, especially high fertility - we are consistently achieving 130 per cent - the returns are very good."

Mr Hammat says he and wife Demelza decided to take the plunge and hold an auction, offering 100 Poll Merino rams on August 13, after many years of private selection.

"We have put a lot of work into the stud and the quality of our sheep has come a long way but there was a barrier to getting new people to come and look at our sheep, which he hope to break," he said.

Baderloo's stud flock has been developed across the past 19 years on SRS breeding principles and strong performance recording.

Merino SA president Nick Wadlow is hopeful clearance rates at most sales will again hit 90 per cent or more, with much of the "inside country" receiving good general rains.

"For those breeding Merinos it is a pretty exciting place to be and there is the potential for a few more ewe records to be broken (this season), we've already seen strong enquiry for ewes," he said.

"The SA Merino has come ahead in leaps and bounds in the past 20 years and really is a profitable strain of Merino to be in, given the fleece weights that can be achieved, plus a lot of early growth."

Mr Wadlow said the only dampening factor for ram sale season was much of SA's pastoral area was still desperately dry.

"Those who supply rams to the pastoral areas will have to ride the season with them until we get general rains in the bush but once it does and the numbers bounce back , the demand will certainly be there," he said.