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Agribusiness giant Webster switches from cotton to sheep to stay ahead of the drought

By Rhys Carman, Tuesday February 5, 2019 - 15:45 EDT
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Webster Limited general manager Paul Martin says the feedlot will ensure quality lambs during the drought. - ABC

One of Australia's biggest agribusiness companies, Webster Limited, has bounced back from the , using funds from the $78 million sale of its water entitlements to diversify.

Tandou Station, near Menindee in western New South Wales, will be turned into one of the biggest feedlots in the region.

Livestock from three properties will be shifted hundreds of kilometres across the outback, taking sheep from Kalabity Station in South Australia and Packsaddle Station in New South Wales to Tandou Station 50km south of Menindee, on the Darling River.

The general manager of Livestock for Webster, Paul Martin, said the decision would help breed healthier lambs during difficult times.

"There are considerable costs involved in building a structure like this," Mr Martin said.

"We've spent a lot of time on our genetics and we pride ourselves on the quality of the lamb that goes to market.

"The reality is if we were to restock when it does rain — if there are any dorper sheep available in Australia — they're going to come at a big price."

Mr Martin said restocking to only half of the company's capacity once the drought broke would cost up to $7 million.

He said running a feedlot of this size would cost about $1.5 million and allows Webster to keep their core breeding stock and maintain production, which paid for the construction of the feedlot.

Once construction was finished and Webster was back in full operation, the feedlot at Tandou would house up to 60,000 lambs a year.

"With the drought situation now, we are going to feedlot 20,000 ewes and we are hoping to get around 25,000 lambs a year," said Mr Martin.

"This feedlot can hold about 9,000 head of lambs at any given time.

"They'll be in here for about 70 days and then they're off to the market so we can process up to 45,000 lambs here without too many worries."

Tandou station was formerly a cotton farm and Webster sold the 21,901 megalitre water entitlement to the Federal Government in 2017, converting the station into the dorper lamb business it is now.

Mr Martin said the feedlot operation at Tandou would remain in place until there was a considerable rain event.

Feedlotting sees 'positive margins'

Goondiwindi-based sheep and lamb consultant Lloyd Dunlop said the process of feedlotting was typically not an economical solution but had become attractive for large operations in the current climate.

"Most of the time I would have advised clients not to get involved because the margins were too small," Mr Dunlop said.

"But at the moment, with the high cost of lamb and despite the high cost of feed, there is a positive margin in feedlotting.

"At the moment, I'm involved looking at even more innovative ways of changing the designs of feedlots to get even better growth rates out of lambs."

Mecardo market analyst Angus Brown said feedlotting was an important process for graziers during the millennium drought.

"It's been something that has been happening for a while but probably not on this scale," Mr Brown said.

"There was a lot of containment feeding going on with sheep to get them through that drought.

"But it's also a good way to give their country a rest and when the drought does break, it will help to get back to full production a lot quicker."

Webster has also floated the idea of bringing in stock from other landholders who were struggling to maintain healthy livestock during the drought.

"It's definitely something that we've looked at — other people around the region have shown interest in it as well," Mr Martin said.

"Ideally we would grow our own sheep in here and put them in here and possibly buy lambs from other areas and bring them back here to feed — if that's going to be financially feasible.

"But that's something we will look at later, we want to get the operation running properly and if we are going to make any mistakes, we would rather make them on our sheep than someone else's."

Mr Martin said it was important to make sure the feedlot design would protect the livestock from extreme heat in the summer and from the strong westerly breeze in the winter.

"Every pen has to have a shade because we can't have sheep standing out here in 45-degree heat and in direct sunlight," Mr Martin said.

"And on the south-western side, where the prevailing wind comes from, it will have a high sheet that protects them.

"The healthier and happier our sheep are in the lot, the better the market value."


© ABC 2019

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