Wool markets in recent months have held fast to familiar split level trends. In the fine wool sector prices are healthy and growers are benefiting from favourable returns. In markets for crossbred wool, demand remains sluggish.

One final, out of season, sale for New Zealand fine wool was conducted in early February, when prices continued to mirror those recorded in Australian sales. Although returns this season have been very strong historically, prices were back off last year’s record highs. Demand continues to be largely driven from active sportswear and apparel manufacturers. Merino and halfbred wools are still commanding strong values, with every indication that this situation is sustainable. Branded direct contracts have been a particularly rewarding option for fine wool growers this year. 

In the crossbred wool market conditions remain extremely challenging. New opportunities to grow demand are still strictly limited, which is placing further continued downward pressure on market values that already sit historically low.

Export wool volumes for July to December 2019 advise China took 37 per cent of New Zealand’s total clip for the period. This is a significant dip from the 45 to 50 per cent that China has consistently taken. Meanwhile, quantities of wool exported to India and a number of European countries have increased.

Coronavirus has had an impact on our market. Initially this was associated with the closure of Chinese trading offices, latterly the focus has shifted more to logistical issues linked to shipping, processing time and mill operations, which have all been disrupted.

On a positive note, we continue to hear more from the market regarding wool’s traceability, biodegradable nature, sustainability and natural quality assurance processes such as our Wool Integrity programme, the market will respond increasingly favourably to our product. Gradually increased awareness of wool’s qualities continues to indicate an improvement in growers’ long term prospects.