A Federal Government-ordered review into live sheep exports has recommended a major reduction in animals on ships bound for the Middle East during the dangerous hot months in the middle of the year.

Key points: Major recommendation from review is to increase space for sheep and reduce number of animals on ships during hot months

Major recommendation from review is to increase space for sheep and reduce number of animals on ships during hot months Independent regulator will also investigate ships with mortality rate of 1 per cent of sheep or more

Independent regulator will also investigate ships with mortality rate of 1 per cent of sheep or more Government also toughening penalties for companies that breach these rules

Federal Agriculture Minister David Littleproud initiated the review after footage emerged showing almost 2,500 sheep dying from heat stress during a trip to the Middle East last year.

Amid other reviews into live sheep exports, Mr Littleproud asked livestock veterinarian Michael McCarthy to review the standards for the sheep trade during the Middle Eastern summer.

Mr Littleproud said one of Dr McCarthy's major recommendations would be a "seismic shift" in the stocking density model that would reduce the number of animals allowed on board in hotter months and therefore increase space for sheep by up to 39 per cent.

"In a sweeping change, Dr McCarthy recommended a seismic shift from stocking density based on animal mortality to one based on animal welfare," Mr Littleproud said.

"The greater mortality is heat stress. Dr McCarthy has created a new model which goes towards addressing this deducing the probability of sheep with heat stress and ventilation and airflow on boats.

The new formula means sheep numbers will have to drop by almost 30 per cent in the hottest months.

The stocking density will vary depending on the month, meaning that as the heat increases, sheep numbers must decrease.

A graph shows the effect of livestock heat stress standards on stocking densities for sheep on live export vessels. ( Supplied: McCarthy review )

Mr Littleproud said the new model could encourage exporters to upgrade their boats.

"[It] could have the potential merit of giving exporters incentive to improve ventilation and airflow to increase their carrying capacity," he said.

Mr Littleproud said the Government had accepted all 23 recommendations from the report, and would implement most of these changes by the next northern summer.

Those who profit from breaching rules face 10 years' jail

Under another key recommendation, the number of sheep deaths that would trigger a review from the independent regulator would also change, from the current 2 per cent threshold to 1 per cent.

Mr Littleproud said the Government would introduce legislation to punish exporters who break export rules including those around stocking densities:

Companies would face fines of $4.2 million, three times the benefit gained or 10 per cent of the company's annual turnover, and directors could face 10 years' prison or a fine of $2.1 million.

Other individuals convicted under the same offence would face 10 years in jail and a $420,000 fine.

"I intend to hold them to account, and I don't think we have held them to account properly as a government," Mr Littleproud said.

"I want to make sure there is a legacy that no matter who comes in after me, that this cannot be broken down."

Mandatory independent observers, automated watering

By the 2019 Middle Eastern summer, ships must have automated environment monitoring equipment fitted in the pens. The report also recommended automated watering systems on all ships.

Independent observers will become mandatory on all live export ships of sheep and cattle, a change that the Agriculture Minister said would be phased in over the coming months.

That observer would be feeding back vision and reports to the independent regulator on a daily basis.

"We will be able to get underneath the bonnet of it and by actually having observers on the boats, we will get better proof and truth about what is happening," he said.

Sorry, this video has expired David Littleproud announces sweeping changes to live sheep exports after review

Western Australian company Emanuel Exports was the exporter responsible for the sheep deaths onboard the Awassi Express in August 2017.

It was the same exporter linked to more than 3,000 sheep deaths during a similar voyage onboard the Al Messilah in July 2016.

When the 2017 deaths occurred, one of the contributing factors was increased heat stress due to the number of animals onboard when the ship reached its final destination in Qatar, where conditions are more extreme.

The ship had been blocked from stopping in Kuwait due to a sudden ban, which meant there were more sheep onboard by the time the ship reached the hotter climate in Qatar.

The McCarthy review has recommended that all ships planning to make any stop in Kuwait should go there first, so that animals can be offloaded.

Exporters accept report, welfare groups say it's not enough

Labor had previously said it wanted a temporary suspension of live sheep exports during the northern hemisphere summer, the most dangerous period for sheep exports.

Opposition Leader Bill Shorten said his party would wait for the McCarthy review before deciding if it would continue to support the trade.

But following ABC revelations a live exporter had warned the Government about the dangers of old ships, Labor announced it wanted live sheep exports to end.

Today, Labor's agriculture spokesman Joel Fitzgibbon said the changes amounted to a "political fix, designed to kick the problem down the road".

"The RSPCA has made it very clear that on the science, the live sheep trade to the Middle East in those hot summer months and community exceptions on animal welfare standards are not reconcilable," he said.

"The changes the Government announced today should have, and would have been, made a long time ago if Barnaby Joyce had not stalled our progress on animal welfare reforms and would have been put in place if we'd had an independent inspector-general for … animal welfare."

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Animal welfare groups want the trade to end and have vowed they would contribute money towards a farmer support package to phase out the industry.

The RSPCA and Animals Australia, the group responsible for leaked footage showing sheep dying onboard the Awassi Express last year, would each contribute $500,000 to a fund.

They want state and federal governments to also contribute to the fund.

Animals Australia described today's announcement as a "lily-livered government response designed to protect exporters, not animals".

RSPCA was similarly scathing of the review, saying its decisions were "weak, not based on science or evidence, and left farmers holding a ticking time bomb".

National Farmers' Federation president Fiona Simson said she could not guarantee sheep would no longer die at sea, but that she was confident the changes would reduce the risk.

National Farmers Federation president Fiona Simson says there's no guarantee sheep will stop dying at sea. ( Supplied: National Farmers Federation )

"What I can give the public a guarantee about is a better system than we currently have. This is a [step towards] improvement and that is, I think, what we have to continually strive for," Ms Simson said.

"We have to strive for a culture of continual improvement and change."

Exporters welcomed the review, with the Australian Livestock Exporters' Council saying the industry would accept all of the changes announced.

"Industry accepts the move to broader, science-based animal welfare indicators on vessels. We will engage constructively with the Government in the development of these measures," chairman Simon Crean said.

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