Department of Agriculture and Food WA (DAFWA) project steering group member Dr Andy Paterson said a number of local businesses were already feeling the benefits of the first stages of construction of the new saleyards.

Katanning business BKW Co-op will supply the roof lintels and Katanning Plant Hire will supply the concrete.

Gnowerangup-based company Auspex Steel will provide the steel for the structure, while Bluescope Distribution Albany will provide the steel reinforcing and piping.

"The State Government has previously announced $17 million for the project as part of its commitment to the Regional Livestock Saleyards Strategy and the Federal Government's Regional Development Australia Fund has contributed $7.2m," Dr Paterson said.

Shire of Katanning chief executive Dean Taylor said 35,000m3 of topsoil had been removed from the 20-hectare site by earthmoving crews from Katanning and the neighbouring shires of Broomehill, Tambellup, Wagin and Woodanilling.

"We had the intention of keeping as much of this project local as possible and it's going well so far," Mr Taylor said.

"We also have 10 local people employed in our on-site manufacturing workshop and construction site.

"The project will deliver a range of added benefits to the Katanning community.

"Water from the roof of the saleyard will be captured on-site and then pumped into a local dam and used to irrigate public open space in the town.

"The project is also forging links with the local high school and TAFE to create opportunities for traineeships and apprenticeships."

The saleyard is expected to be complete in September 2013.