News

Erratic season sees wool price record broken

By Rodney Woods

It may have been one of the best wool seasons in history, but the market has also been erratic.

In August 2018, the market reached record prices of 2116¢/kg but ‘‘ended on a bit of a whimper’’, according to Australian Wool Innovation trade consultant Scott Carmody.

‘‘We are on 1710¢/kg today (July 4) and the season average of 1939¢/kg is 200¢ better than any other season we’ve had,’’ Mr Carmody said.

‘‘Last year was the best we’ve had but also one of the most erratic.’’

Mr Carmody said prices had been building since 2012.

‘‘There was a steady build-up of demand from the middle of 2012 to August 2018, where prices peaked and they pushed up beyond where consumers were comfortable buying it.

‘‘We need to rebuild the confidence of wool at this price and get to the consumers and tell them why they need to buy wool.’’

The erratic nature of the market is common, but during the past 12 months it has been external factors that have made prices drop.

‘‘A lot of the deterioration is because of external reasons away from wool,’’ Mr Carmody said.

‘‘We are seeing very subdued spending, Brexit is playing its part as well as the China-US tariff dispute.

‘‘We are hopefully at the base in the market now.’’

Looking forward, Mr Carmody said it was difficult to predict where prices were headed but was hopeful they would start tracking in the right direction once again.

‘‘All signs are saying this is the base of the market,’’ he said.

‘‘It’s largely in the hands of the consumers and whether they renew their spending.

‘‘We don’t like crystal ball gazing because we are not in a position to predict global demand confidently.’’