New Report Finds Wool Producers Could Be $120 Million Better Off by Ending Live Lamb Cutting (Mulesing)

A new Pegasus Economics report commissioned by FOUR PAWS shows Australian wool producers could be $120 million better off within seven years by transitioning from live lamb cutting (mulesing) to plain‑bodied sheep. With more than 330 global brands rejecting mulesed wool and international bans looming, the report warns of major economic, social licence and market‑access risks for Australia’s $3 billion wool industry.

A new report from Pegasus Economics, commissioned by global animal welfare organisation FOUR PAWS, found that wool producers could be $120m better off within seven years by transitioning away from live lamb cutting (also known as mulesing).

The report comes as Australia’s wool industry faces a growing economic threat, with more than 330 global fashion brands — including H&M, Kathmandu, Nike, Myer, Hugo Boss, Burberry and Zara — moving away from mulesed wool. Exporters, brokers and buyers warn that Australia risks losing access to premium markets.

Live lamb cutting is a painful, invasive and terrifying practice in which young lambs have large portions of their skin and flesh cut off around their tail to create scar tissue, to prevent flystrike.

Australia is the only country in the world that still practices this as there is a global movement to ban it, and for brands to not accept mulesed wool. 

All other major wool-exporting countries; including New Zealand, South Africa and Argentina have outlawed live lamb cutting, leaving Australia as the last major exporter still permitting it. 

The Pegasus Economics Report further identified that,  non-mulesed wool is attracting price premiums (typically 9–13%, higher under certification), with demand for certified wool rising fast.

Additionally, one of the biggest threats identified in the report was that of ‘social licence’ - Mulesing threatens the industry’s “social licence to operate”, raising the risk of consumer boycotts, trade barriers and loss of market access including spillover impacts on sheep meat exports. 

Speaking on the contents of the report, Animal Justice Party MP Georgie Purcell said if the blatant animal cruelty alone wasn’t enough to make the Australian wool industry act, the economic impact identified in the report should. 

In 2004, Australian wool industry leaders made a commitment to phase-out live lamb cutting by 2010, only to abandon this one year before the deadline. As a result, the practice continues with 10 million lambs enduring this excruciating mutilation practice every year.

The Australian Wool Innovation (AWI) has wasted over $48.5 million of taxpayer funds and compulsory wool producer levies pursuing a string of failed and impractical “alternatives” to live lamb cutting, from clips and liquid nitrogen to vaccines and Sterile fly research, none of which have delivered real-world, industry-wide solutions. 

Instead of backing the proven transition to plain‑bodied sheep, AWI has funnelled resources and decades into dead-end experiments, delaying progress and entrenching a problem that already has a clear, effective answer.

The majority of Australian merino wool producers currently live cut their lambs. The alternative is simple: Moving to plain-bodied sheep. Plain-bodied sheep do not require live lamb cutting as they are naturally resistant to flystrike. They also produce comparable wool volumes, deliver better fibre quality consistency, are faster and cheaper to shear and have higher reproduction rates and lower lamb mortality. 

The current system is being protected as wrinkly Merino sheep have been heavily selected and commercialised over decades, but the transition is already viable. According to an independent BG Economics Report, transitioning away from live lamb cutting is feasible within 3-5 years.

Australian wool growers who are moving away from live lamb cutting, have indicated that with developments in science and genetics have made it easier than ever to make the transition. 

As significant bans of mulesed wool through the EU and in China loom, the economic threat to the approx. $3 billion industry in Australia is real. Farmers who have managed the transition to plain-bodied sheep, have indicated there is a lack of stewardship by Government and the wool industry peak body to support growers if these bans come into place.

The industry has failed wool growers, consumers and brands. FOUR PAWS is calling on the Government to step in.

Data was analysed from the survey responses of 97 woolgrowers who undertook an online survey in December 2019 and January 2020.

• 77.5% completed the transition to plain-bodied Merinos within five years and 42.7% within two years 
• 83.5% say transitioning to plain-bodied Merinos is not costly 
• 82% have experienced increased lamb growth rates. Lambing percentage is also increased 
• 72.2% experience <=0.5% breech strike and 92.5% <=0.5% body strike 
• 87.6% receive a price premium for their unmulesed wool 
• 84.1% have experienced an increased return on investment 
• 86.6% would recommend to other woolgrowers to undertake the transition to plain-bodied Merinos 
• 98% say not mulesing is important for their farm’s future profitability