FALLING sheep numbers and lower drought-affected wool cuts are forecast to shrink Australia’s clip to 272 million greasy kilograms in 2019/20.

In its third forecast, the Australian Wool Production Forecasting Committee has today forecast a 9.2 percent decline on its 2018/19 estimate of 300 mkg greasy.

Committee chairman, Russell Pattinson said high adult sheep slaughter rates in 2018/19, which were up 16pc on 2017/18, reduced the number of sheep available to be shorn during 2019/20.

“Persistent dry to drought conditions, limited pasture and stock water availability in key wool growing regions combined with strong returns for mutton and lamb continue to reduce the number of sheep on Australian farms,” he said.

The number of sheep shorn in Australia during 2019/20 is forecast to fall by 7.5pc to 67.1 million, while average wool cut per head is forecast to fall by 1.7pc.

NSW wool production forecast to fall by 13.7pc

In New South Wales, shorn wool production is forecast to fall 13.7pc (Table 2), by 4.8pc in Victoria, by 4.7pc in Western Australia, by 10.5pc in South Australia, by 6.7pc in Tasmania and by 17.3pc in Queensland.

The committee’s August forecast of a 4.8pc year-on-year decline in shorn wool production during 2019/20 was predicated on average seasonal conditions. Since then, reasonable seasonal conditions have only been evident in western Victoria where wool test volumes in some key regions have climbed above the 5-year average and in south-east South Australia and the mid-north of Tasmania where volumes are on par with last season. However, poor seasonal conditions in many other wool producing regions in New South Wales, South Australia, Queensland and Western Australia have continued through spring. As a result, average cut per head this season is expected to decline by 1.7% nationally to 4.1 kg greasy.

AWTA wool test volumes to the end of October 2019 were down 10.8pc year-on-year while AWEX first-hand offered wool to the end of week 20 was down 20.1pc. The decline in the latter is partly due to the recent volatility in the wool market which has resulted in high auction pass-in and withdrawal rates. ABS wool receivals from July to the end of September were down 16.1% compared with the same months in 2018/19.