At least 10,000 Australian sheep sent to Pakistan have been slaughtered, with Pakistani newspapers reporting a video which they say shows some of the animals being clubbed to death and others buried alive.

Karachi-based PK Meat and Food Company bought the sheep after authorities in Bahrain rejected the shipment on the grounds the animals were infected.

Authorities in Karachi then ordered the boatload of 20,468 sheep be killed because of the disease risk, but PK Meat and Food obtained a court order which temporarily stopped the killing.

The Pakistani court has now adjourned until Friday its decision on the remaining sheep stranded in Karachi.

But disturbing vision has surfaced which shows the brutal way in which 10,000 sheep were killed by local authorities.

The ABC has not seen the footage but Steven Meerwald, managing director of Wellard, the company that exported the sheep, has confirmed seeing it.

"One of the staff members at the facility took that vision during the culling, at some risk to themselves to be able to get evidence," he said.

Several Pakistani media outlets have also reported on the cruel footage.

The News International said the sheep had been stabbed, clubbed to death and buried alive.

The Express Tribune, another Pakistani paper, says nearly half of the 20,000 Australian sheep at the Karachi feedlot are either dead or missing.

Kazim Alam is the journalist with the Express Tribune who visited the feedlot where the sheep are being held.

"Along the boundary of the pen, I could see the dead sheep with flies buzzing around and the smell was absolutely - I just could not bear it," he said.

He says he was also shown a video by the importer showing some of the animals being destroyed by inexperienced butchers.

"The images were horrible. I could clearly see an animal which was evidently alive," he said.

"The animal was clearly alive, I could see the animal breathe, and yet, the animal was lying on a pile of recently slaughtered sheep. So it was very, I should say, cruel and inhumane."

Investigation

Lyn White from Animals Australia raised the local media reports with the Government this morning and an investigation is now underway.

"There is no happy ending here. These sheep are either going to be culled or they're going to be killed for human consumption. Either way, they'll be slaughtered while fully conscious," she said.

She says Australian authorities have little control over what happens to the sheep once they are exported.

But she says it was not until the animals lost their commercial value in Pakistan that people became concerned about their welfare.

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"As soon as they seemingly lost their commercial value in Pakistan and the cull was ordered, we were so concerned about how they'd be treated," she said.

"When they had commercial value they are slaughtered in a manner that is unacceptable in Australia, let alone when they have none."

While Ms White concedes that the Middle East is Australia's largest market for sheep exports, she says Australia needs to draw a line.

"A question has to be asked, when is enough profit enough and when do ethics kick in here? And we keep these animals in our care, under our protection," she said.

'Gruesome' footage

The Federal Agriculture Department's acting deputy secretary Paul Morris says the exporter of the sheep, Wellard, could be held responsible for their treatment in Pakistan under the new export supply chain assurance system.

"There's a range of conditions that can be placed on future exports if they're found to be in breach of those requirements and ultimately there is a penalty of removing their licence if severe compliance problems are found," he said.

In a statement the Fremantle-based exporter said "we are concerned by the slaughter method because it is inconsistent with Wellard's animal welfare ethos".

Wellard says its stockmen were forced to leave its export partner's accredited abattoir by local police, and local livestock department officials then undertook a cull.

Stephen Meerwald is quoted in the International News report as saying he has not eaten or slept since seeing the "gruesome" footage.

"Regardless of whether they were healthy or not, the way they were killed or buried alive is neither humane, nor Islamic," he said.

The Agriculture Department says it and Australia's High Commission in Pakistan continue to be "actively involved" in matters relating to the sheep in Karachi.