Worldwide Pressure Impacts British Wool Prices
With thoughts quickly turning to shearing this year’s wool clip, British Wool has issued its latest wool values.
British Wool’s chairman Ian Buchanan says this year’s wool values are largely based on prices achieved at auction through the first quarter of 2017 along with market intelligence.
“As producers will notice, unfortunately, this year’s average values are lower than those of last year. This is simply a result of reduced competition among buyers as demand dropped across the world.
“Both British and New Zealand wool markets have seen declines in prices over the last 12 months, with wool values in both countries now in line for the first time in many years. The global market over the last 12 months has been challenging and there has been a reduced demand for crossbred wools. These are wools which both the UK and New Zealand produce in significant volumes and this has been reflected in the prices paid at British Wool auctions,” he explains.
“The fall in average auction price for British wool across the past 12 months is obviously a situation we would rather see in reverse, but producers can be rest assured that British Wool is working hard on their behalf to maximise the market value of their wool and ensure global buyers recognise the quality of the clip on offer.
“There are some early signs that demand for crossbred wools may be on the rise again in 2017, particularly from the Chinese market, especially if the clip colour of British wools improves, after a poor year in 2016.”
British Wool chief executive officer Joe Farren said the organisation was working hard to ensure it operated as efficiently as possible at every level. “We are currently bedding down a new productivity approach, including process improvements in the depots and the early signs are encouraging in terms of the savings we can achieve. We’re also looking at the location of our collection centres across the UK to identify gaps in our coverage. It’s important we look to maintain and improve our service to you. In fact, we have just opened two new collection centres in Co Antrim, Northern Ireland.
“British Wool also recognises that we have a quality product, which we must market much more effectively than in the past. We are going to be smarter, more targeted and remain focused in terms of how we generate consumer and retail interest in British Wool carpets, coverings, bedding and clothing.
“British Wool’s business has seen little change for the last 30 years, but we are working hard to modernise the business, introduce a more commercial approach and shape the way we operate to make us fit for the significant industry and competitive challenges that we face. Improvements will start to come through and make a visible difference in certain areas in the coming months but we also need producers’ continued patience and support to allow us to complete this overhaul in the next three to five years,” added Mr Farren.
Mr Buchanan added that British Wool was committed to working with producers to maximise the value of the 2017 wool clip and that included helping farmers understand what they can do on-farm to deliver a higher value clip. “The latest wool values for 2017 based on auction sales through the spring include Romney wool at £1.00/kg, Texel at £0.90/kg and Mule at £0.85/kg, with Cheviot wool at £1.20/kg.
“Meanwhile, at the lower end of the value spectrum Blackface fleeces are likely to be worth £0.60/kg, with Swaledale at £0.40/kg and Welsh £0.45/kg as in 2016. It is important that sheep producers recognise the work British Wool is doing on their behalf to maximise the value of the clip, including in shearer training, wool grading and also the organisation’s competitive auction system,” he added.
“No other organisation works as hard for wool producers or puts as much back in to the sheep industry as British Wool does. We are committed to the future of the UK sheep sector and are working to deliver better returns wherever possible.”