Australian wool price high due to growing Chinese demand

Australia, the world’s largest wool producer has touched wool exports at about Au$3 billion (approx. $2.28 billion) of which China accounts for over 70 percent of this value. China utilizes about 60 percent of all wool imported for making products that are consumed by the Chinese, compared to almost full re-export of wool around 15-20 years ago. Chinese companies use Australian wool for manufacturing a range of products including apparel, sportswear and shoes. Strong demand from growing affluent Chinese consumers has pushed up Australian wool prices to a record high this season.

Besides growing Chinese demand, high wool prices are also due to other factors like limited number of Australian suppliers and decreasing wool supply. Wool prices are currently at a high of more than Au$16 per kilogram. Though prices are not as high as they were about five years ago in terms of US dollar, Australian wool growers are earning more due to weaker Australian currency.

Australian Wool Innovation (AWI) CEO Stuart McCullough at the recent annual general meeting (AGM) of AWI said that the level of optimism that is currently seen in the wool industry has not been witnesses in the past many decades.

AWI has recently unveiled WoolQ, earlier called the Wool Exchange Portal, a platform for woolgrowers, buyers, brokers and classers, seeking access to data, selling choices and trading opportunities.

McCullough said that international marketing campaigns aided by the development of new and innovative fabrics continue to connect more retailers, brands and consumers with Australia’s natural fibre.

Moreover, initiatives such as the Merino Lifetime Productivity project, wild dog control and Lifetime Ewe Management help woolgrowers lift their production and profitability..