What risks should Australian sheep farmers be aware of?

Sheep farmers can benefit from insurance in a number of ways, depending on how their policies are structured. If certain details are in place, these farmers may be covered in the event something were to happen to their livestock.

However, what about fiscal risks or diseases? How can farmers manage the economic impact of these issues?

Price variation

The foreseeable future looks promising for Australian sheep farmers, financially speaking. According to an April 20 report released by Meat and Livestock Australia (MLA), sheep and lamb prices should hold steady over the next few years.

Consistent global demand, tempered production in New Zealand and a modest Australian dollar will contribute to mutton's profitability. MLA Manager of Market Information Ben Thomas provided further insight into the situation.

"Offsetting the potential downward pressure on prices will be a slowdown in slaughter, which will happen if the three month rainfall outlook comes to fruition," said Mr Thomas.

A separate MLA report, released in February, predicted that this year's total flock will hold at around 71 million head. This number is expected to increase to 73.85 million by 2019.

Disease

Given the MLA's statistics, it appears that farmers won't have to worry too much about unexpected price decreases. However, what about illnesses capable of killing off sheep? Can farm cover protect losses caused by diseases?

Obtaining insurance, depending on the policy details, may be of help. Still, one of the best ways to manage disease risk involves knowing the symptoms of certain ailments and identifying which diseases certain stock types are vulnerable to.

For example, young lambs and weaners are susceptible to coccidiosis, pneumonia and tetanus, according to Biosecurity South Australia's Sheep Diseases guide. In contrast, pregnant and newly lambed ewes may suffer from milk fever, ovine brucellosis or vibriosis.

Learning about these ailments can help you identify methods of treating them. It's one of the best ways to reduce the risks associated with managing a flock.