The extensive livestock production industries are vital to the national economy of Australia. Continuing improvements to extensively-raised livestock welfare is desirable, necessary and in some situations mandatory, if the social license for animal sourced food and fiber production is to continue sustainably. However, meeting increasingly high welfare standards is challenging. The changing climate in this millennium, has seen the occurrence of two of the most severe drought periods on record in Australia, resulting in complex welfare issues arising from unforeseen disease, trade and environmental catastrophes. The onset of the first drought coincided with an uncontrolled epidemic of ovine paratuberculosis. It ended just prior to a temporary ban on live export of tropical cattle to Indonesia that induced a major market failure and led to severe morbidity and mortality on some beef properties. The second drought period progressed in severity and culminated in the most extreme bushfires recorded, causing unprecedented levels of mortality, morbidity and suffering in farmed animals and wildlife. Temperature extremes have also caused periodic heat-associated or cold-induced hyopthermia losses, requiring increased vigilance and careful management to reduce both temperature-induced stress during transport and the high ovine peri-parturient losses traditionally observed in extensive sheep farming. Several issues remain controversial, including surgical mulesing of wool sheep to manage flystrike, and the continuing live export trade of sheep and cattle. However, in reviewing the increasingly complex welfare challenges for the extensive livestock population industries that are export trade dependent and remain vulnerable to welfare activism, it appears progress has been made. These include development of prescribed livestock welfare Standards and Guidelines and the introduction of the Exporter Supply Chain Assurance System (ESCAS) to address export concerns. Further, the sheep mulesing crisis led to improved producer welfare attitudes and practices, including pain management during aversive husbandry procedures that is now occurring globally. Finally, innovations in animal welfare surveillance and assessment, are additional encouraging signs that suggest improving change management of extensive farm animal welfare is occurring that provides lessons well-beyond Australian shores.