Positive outlook for wool prices

Wool prices look set to remain firm this year, as tight supplies and rising demand underpin markets.

The British Wool Marketing Board‘s latest price indicator – a weighted average selling price for different grades – was 153p/kg in mid-January, up 60p/kg on the same period last year.

Average prices to farmers for the 2010 clip were also well up, with Mule wool at the last sale (12 January) averaging 110-112p/kg, up from 65p/kg last year. Cheviot wool averaged 118p/kg, up from 72p/kg, while lower-quality Swaledale and Welsh Mountain wool prices were both around 40p higher at 63p/kg and 82p/kg respectively.

“Clearly, wool producers have waited a long time to see a decent return for their wool,” said BWMB chairman Frank Langrish. “The price received this year will see most producers not only cover the cost of shearing, but leave a profit margin as well.”

UK prices were about 10% higher than New Zealand and he was confident markets would remain firm.

“Australia has seen its lowest wool production for a decade, the New Zealand sheep flock has fallen from 65m to 35m and the UK clip has also fallen to from a peak of 50m kg in the early nineties to 28m kg now. Also, cotton and other textile fibres are rising in price.”

Mr Langrish said wool would be increasingly sought after, especially as rising oil prices pushed up the cost of synthetic fibres. In addition, he said the cross-industry Campaign for Wool, launched last January, had boosted demand and the campaign would be rolled out worldwide this year.

“We’re keen to see demand for all wool grow, but the US is a particularly important market for our types. At the moment only about 4% of carpets in the US are made from wool, so we only need to increase market share slightly to generate a big increase in demand.”

wool table

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