Global demand for wool keeps prices high

Prospects for increased wool production and rising wool prices are positive, with the product in great demand worldwide, says HB van der Walt, newly-elected chairperson of the National Woolgrowers’ Association in the Eastern Cape.

- Advertisement -

Despite the effects of the drought in many of the important wool production areas, production in the Eastern Cape had dropped by only 2% from the previous season, Van der Walt told Farmer’s Weekly.

South Africa produces about 50 million kilograms of wool a year, with the Eastern Cape contributing about 50% of this.

“Good rains in most of the critically dry areas brought much-needed relief in the last month or so, and wool farmers can therefore enter the new season with optimism, especially if good rains fall in the remaining dry areas,” said Van der Walt.

- Advertisement -

“The drought caused a small drop in quality, while the average clean prices for the selection within the different micron categories for good top-making long fleeces gained 1,8% at the most recent sale.

“Wool prices are very stable despite the rand’s ups and downs against the dollar. The demand for good quality wool is still very good worldwide and there is no superfluous wool available anywhere. If you want wool, you have to buy it at the auction.”

At the 28th and final auction of the 2015/2016 season, prices dropped by 1,3%, while the Cape Wools Merino indicator decreased by 198 points to close at R155,70 (clean). A total of 11 270 (98%) of the 11 408 bales on offer were sold.

The next sale is scheduled for 13 April 2016.