British wool sales update
Global wool markets have remained challenging through the summer, wool is selling but not at prices that give members a sufficient return for their wool. There are however some positive signs with improved demand for from the contract carpet sector, significant growth in the number of British Wool licensees and several new brands set to launch British Wool ranges through the Autumn.
Summer months are seasonally the most challenging for wool sales. Competing supplies from other European markets are available to buyers, and many processors and manufacturers have annual shutdowns during July and August. This is why British wool reduces the size of its offers at this time of year, explained CEO Andrew Hogley.
Given that British wool represents just 2% of the global wool supply it is essential that British Wool differentiates its product from the global market. The contract carpet sector has always valued British wool for its superior bulk and appearance retention but we cannot rely on just one market segment.
Over the last 18 months we have worked hard to develop the British Wool brand identity and implement a traceability scheme. It is encouraging that these measures are helping to increase the number of brands that are signing up as British Wool licensees. As at the start of September we had more than 125 brands with ranges made from British wool. The pipeline of new product launches through the autumn should help drive this higher.
Ensuring that we have a competitive auction system has been a strategic priority for British Wool in the past few years. Having a wide range of buyers ensures that we have customers for our wool even when demand from UK manufacturers and processors is weak. Recent sales have demonstrated the organisation’s success with this strategy. Five years ago, we relied on our two main buyers for as much as 90% of sales but over recent months other buyers have bought more than 30% of our wool. We now have a better balance in the auction.
In addition to driving demand British Wool remains focussed on driving operational improvement through the business in order to help maximise returns for members. Our process improvements and investment in IT in the depots has driven a significant uplift in productivity this season as has the move to a new site in the Scottish Borders.
Wool intake is tracking behind previous years. Wet weather delayed shearing in many parts of the country and farmers have prioritised other jobs on farm over the summer. Now is a pertinent time to remind our members of their role in helping us drive demand and better prices for wool. I hope they will support us by delivering their fleeces as soon as possible.Back to Blogs