Graphic footage showing animals bleating as they are violently slaughtered has prompted fresh calls for a ban on live exports.
Independent MP Andrew Wilkie claims the latest footage from Animals Australia shows the cruelty is systemic and wants the trade shut down.
He's labelled Agriculture Minister Barnaby Joyce the Minister for Cruelty, arguing live exports are indefensible.
"Barnaby Joyce doesn't just turn a blind eye to the cruelty - he rubs his hands together with glee at the prospect of it continuing," he said.
"I would challenge him to come out and say what we saw today is not wrong."
Mr Wilkie accused the federal government of lying when it says a ban would hurt farmers and regional communities, insisting processing meat in Australia before exporting it would create thousands of jobs.
"For the government to claim otherwise, it is either naive or it's dishonest, and I'd suggest in this case it's dishonest.
"Why the government would pander to such a small proportion of the red meat industry for the benefit of such a small number of producers and commercial entities beggars belief."
The footage released on Tuesday shows distressed animals crying out as they are carried upside down by their bound legs, to have their throats slit.
The three-minute clip was shot in countries across Asia and the Middle East during Eid al-Adha, the Islamic Festival of Sacrifice.
Mr Wilkie insists the inhumane slaughter has nothing to do with Islam, arguing the religion does allow for animals to be stunned.
He says the Exporter Supply Chain Assurance System designed to ensure animals are handled humanely is just "window dressing".
"It's so the government can claim that they've taken action but it has in no way diminished the cruelty to Australian animals."
Animals Australia says no exporter has had their licence suspended or faced prosecution despite numerous videos over several years documenting cruel practices.
"Our evidence once again presents a reality that is poles apart from the industry spin," chief investigator Lyn White said.
A spokeswoman for Mr Joyce said the Agriculture Department was investigating the footage and defended the ESCAS, insisting it was working.
The number of sheep found outside supply chains for Eid was two-thirds lower at 4000 in 2016 than the previous year, she said.
"Nobody supports animal cruelty, least of all Australian farmers and exporters," she said.