Increasing Wool Prices

The price of wool in Australian dollars has been increasing since 2014.  According to Dr. Caroline Gunning-Trant, senior ABARES Economist.  The expectation is now for strong continued demand for Australia wool exports and strengthening of prices for producers.

“In the two years since early January 2015, prices have risen by about 35 per cent,” Dr Gunning-Trant said.  In the past five years the AWEX monthly Eastern Market Indicator has never been higher.

“The upward trend in prices reflects the constrained supply of apparel wool—due to lower flock numbers over the past years—and firm demand currently, particularly for fine wool.”

According to the AWI (Australian Wool Innovation) Market Intelligence Report June 2017, superfine demand is at record levels.  Next to skin garments have been a large contributor to this.

Stuart McCullough, CEO of the Australian Wool Innovation (AWI)  “believes strong (wool) prices are due to a consistent and steady long-term shift in consumer sentiment towards the fibre and appreciation for its premium natural qualities.”

“Wool demand is continuing to grow in the European Union and the USA—the major international markets for imported clothing,” Dr Gunning-Trant said.

“And in China, wool consumption is forecast to grow more strongly because of relatively high rates of economic growth and increasing domestic consumption of luxury woollen textiles.” China is the world’s largest producer and exporter of woollen clothing and textiles and a major consumer of finished woollen goods.

Stuart McCullough, CEO of the AWI, stated in June 2017 “ that strong (wool) prices are due to a consistent and steady long-term shift in consumer sentiment towards the fibre and appreciation for its premium natural qualities.

Excerpts from ABARES Outlook 2017, and Beyond the Bale, Issue 71, June 2017.