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Wool forecast lifts with good season, more sheep shorn and extra sales

by Sheep Central, 21 April 2017

More wool coming is the latest prediction.

AUSTRALIA’S wool production is expected to increase to 339 million kilograms this financial year, but it might be too early to tell if this means the steady decline in farm fibre output for more than 20 years has turned around.

The Australian Wool Production Forecasting Committee latest forecast is that Australian shorn wool production in 2016/17 will increase by 4.3 percent to 339 mkg greasy, largely due to excellent seasonal conditions in many areas lifting fleece weights.

The committee said the strong wool market conditions also appeared to be encouraging producers to retain sheep, so sheep shorn levels are also expected to be higher.

But the committee also believed some wool, particularly ultrafine wool, has been released from the stocks held on-farm and also from stocks held in broker’s stores in response to recent higher prices.

Australian growers produced 325 mkgs of wool in 2015-16, which is well under half the 815mkgs sold in 1992-93.

Committee chairman Russell Pattinson said he was not in a position to make a judgment call either way on whether Australian wol production had turned around.

The committee’s first forecast for 2017/18 is for shorn wool production to be 340 mkg greasy, up by 0.4pc, due to a combination of slightly higher wool cuts per head and sheep shorn numbers. This assumed normal seasonal conditions through autumn and into 2017/18.

Mr Pattinson said as expected in December, the excellent seasonal conditions in virtually all of the major sheep producing areas of mainland Australia have resulted in higher average wool cuts per head this season.

Some states such as Western Australia, South Australia and Queensland have seen the benefit from the improved seasonal conditions throughout the 2016/17 season and fleece weights are even better than the committee previously expected. For other states, notably Victoria, the improved seasonal conditions came later and average wool cuts per head have only increased at shearings from late spring onwards.

“These excellent seasonal conditions combined with the high wool prices in the past few months have also encouraged producers to retain older sheep to help rebuild their flocks and for shearing,” Mr Pattinson said.

The 4.3pc forecast increase in shorn wool production compared with a 4.7pc increase in the weight of wool tested by AWTA in the first nine months of 2016/17 and a 6.4pc increase in the first hand offerings of wool at auction recorded by AWEX.

The committee noted that for the 2016/17 season to March, AWTA test data showed a significant increase in the weight of wool tested between 20 micron and 24 microns and declines in the volumes of 17 micron and 18 micron wool. This probably mainly reflects the excellent seasonal conditions.

There has also been a significant fall in the volume of 26 to 30 micron wool. The mean fibre diameter for Australia to March was 21.0 microns, the same as in 2015/16.

The national committee drew on advice from the six state committees, which comprise growers, brokers, private treaty merchants, representatives from state Departments of Agriculture, and the Australian Wool Testing Authority. Data and input was also drawn from AWEX, wool exporters, the Australian Bureau of Statistics, ABARES, AWTA and Meat and Livestock Australia.

The full forecast report will be available on the AWI website at www.wool.com/forecasts from 28th April 2017.

Click here for the latest Australian wool production estimates.

Click here to see the shorn wool production by state – 2015-16 and 2016-17.

Click here to see historical wool production figures.

Source: Australian Wool Innovation.

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