Jamie Mackay from The Country has caught up with Palle Petersen from PGG Wrightson for the monthly report on the state of the wool market.

Things kicked off on a low note as Jamie wonders whether Palle has ever known the wool market to be as bad as it currently is.

Palle agrees the outlook for the next year is grim.  But we're still above where we were when COVID hit.  A global recession, manufacturing costs going through the roof, consumers not having much to spend after high living costs and inflation take their toll.  All these factors contribute.

Jamie mentions the concerns around poor wool clip preparation.  He reckons you can't blame the farmers when they're getting next to nothing for their wool.  They just want to get it in the bale and get rid of it.  Palle says that at times like this, it does pay to take good care as you do see premiums paid for well-prepared wool.  Palle notes there is quite a bit of contamination coming through - like rubbish and even T-shirts!  It's important for farmers to at least show up in the woolshed at shearing time and tell the shearers what you expect.  If they think you don't care, it's easy for shearers to take the same attitude.  It doesn't take much to keep it clean and tidy.

So what's the good news?  Wool is natural and sustainable.  It has to become fashionable again soon.  Palle sees 2024 as the year for a likely turnaround.

They've just had one of the biggest users of New Zealand crossbred wool out here.  They're continuing to expand production as they see a swing towards natural fibres.  Demand for wool is expected to increase world-wide.  If supply is slipping - which it seems to be - this could be a problem, long term.