\"Australia\'s global trade in meat, wool and live sheep strongly influences strategies that can be used to improve its competitive position and profitability for producers. Growth in the sheep industries is dependent on export markets. Australian sheep meat production is split equally between domestic and export markets. Sheep meat exports from Australia account for about 6% of international trade. Finishing of lambs on grain diets has enabled Australia to efficiently produce higher carcase-weight lambs suitable for the US market. Productivity gains in Australian production can be captured via the sale of extra Australian sheep meats into large international markets. Australia accounts for about 40% of global trade in live sheep, with most markets centred in the Middle East. This trade is split between culturally based demand and supply of low-priced meat in competition with other meats such as chicken. Proximity to the Middle East and clean health status are competitive advantages for Australia. This is a volatile and seasonal market that has a significant impact on Australian sheep prices, particularly in Western Australia, which supplies about 80% of Australia\'s live sheep exports. Reducing volatility in the live sheep market and developing demand for chilled and frozen sheep meat will provide benefits to Australian producers. Australia produces about 30% of total world wool, and is the dominant producer of finer Merino wool, accounting for about two thirds of global production. This dominant global position means that any extra production from Australia is likely to have a direct impact on world price. Productivity gains in fine Merino wool production must be matched with market demand building to sustain global price to enable Australian producers to capture benefits in profitability. Over the past 15 years, China has emerged as the world\'s largest producer of sheep meats and a major producer of wool. China is also a major consumer of sheep meats and wool.
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