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Wool growers hope markets have bottomed out

Rural News

Wool prices have begun the long road to recovery after a week of record rises.

Value of the fibre has plunged after hitting records 12 months ago.

The Eastern Market Indicator was above 2000c/kg at the start of the year, but by the start of last week it had dropped to 1365c/kg.

AWI Trade Consultant Scott Carmody told Macquarie’s rural reporter Eddie Summerfield, price rises came with wool producers sick of ongoing low prices.

“Wool growers were showing resistance to price levels on offer, so they were withdrawing wool from auction they weren’t prepared to take the price,” Mr Carmody said.

Prices have been spiraling down, as trade tensions continue to linger between China and the US.

“It’s right across the whole gamut of textiles in clothing, people have basically stopped spending, and it’s just not the China domestic market, but also all through the northern hemisphere is basically slowing down demand.”

Last week’s rises of 9.5 percent on Wednesday, followed by 2.7 percent to take the EMI to 1535c/kg has the industry hoping prices have bottomed out.

But Scott Carmody explains it’s the entire supply-chain feeling from instability in the global market.

“I’ve just got back from China, does not help them either, they’re thinking the same way the grower is, there’s got to be better stability around the wool auction market.”

Listen to the full interview above where Eddie and Scott discuss the impacts of the fluctuating markets, how farmers are managing drought, and how the final 3 months of 2019 is looking for wool producers.

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Rural News