News

Wool prices likely to stay high

By Rodney Woods

An increase of 400¢ in wool prices across the past 12 months may be impressive enough, but the Australian Wool Innovation chief executive officer says there is no drop in sight.

As the 2017-18 season closes and the new year begins, wool is selling for between $19 and $20/kg, something Stuart McCullough said was ‘‘amazing’’.

‘‘We’ve had a pretty amazing year,’’ he said. ‘‘If we go back 12 months the price has increased by 400¢, which is extraordinary. A $4 incremental gain is fantastic to see.’’

And Mr McCullough said farmers were taking advantage.

‘‘They’ll sell for another couple of weeks and then have about four weeks off,’’ he said.

‘‘There’s been a bit more stock on the market before the end of the fiscal year. Normally they wait to sell after July.’’

Asked whether these record prices would continue, Mr McCullough said it was hard to tell but the balance of supply and demand was in producers’ favour.

‘‘I don’t know (if and when the price will drop). What we do know is that supply has been pretty static in the last eight years and two things determine the price — supply and demand,’’ he said.

‘‘Demand out of Asia is certainly in excess of supply so we should get used to these figures.

‘‘Basically none of it sells here — under one per cent ... I’m confident that demand is there in the market (to keep prices where they are).’’

Mr McCullough said he looked at the markets after breaks in the industry.

‘‘They have a couple of weeks off at Christmas as well. Especially the markets in January and February are good indicators for how the year is going to go.’’