Fine wool market: Price premiums now present over broader microns
/JAMIE-LEE OLDFIELD, The Weekly Times
February 2, 2017
SUPERFINE wool has flourished on the market so far this year, achieving a price premium over broader microns.
The extra work needed to produce wool on the finer end has not been rewarded by better returns for a number of years, but the gap is now starting to widen again.
Last week, the 17 micron indicator in the south finished 250c/kg above the 19 micron indicator.
The sheep flock at Avington Merino stud, via Kyneton, averages 15.8 micron, with fleeces ranging from 12 to 18 micron.
About 20 per cent their annual clip, 62 bales averaging 16.5 micron, sold at the Australian Wool Exchange in Melbourne recently, and averaged $2640 a bale.
Principal Noel Henderson said this price was at least 20 per cent up on the previous year.
“A third of the clip went before Christmas, and this price was up about 10 per cent again on that, and we’ve got the top end of our clip going into the market in the next few weeks,” he said.
“Selling over a number of weeks is a way of testing the market, making sure that if it is a rising market that we have our best wool on hand to capitalise on market conditions.
“At the moment the brokers advise the market is going to keep going at this rate and that it relates to a lack of supply with the finer wool.
“We’ve seen the end of a long-running drought on the east coast, and that brought about a lot of fineness in wool that wasn’t genetic and now starting to see with the terrific year we have just had where peoples micron really sit, and there is a lot less finer wool than predicted and it is pushing the prices up.”
Mr Henderson said the premium for finer wool over broader microns was long overdue.
Happy days: Kirstie Anderson, from Avington Merino stud, with agent Ron Creek, Australian Wool Network, and children Georgie, 8, and Jack 10, at Melbourne, where the family offered superfine wool for sale. Picture: Jamie-Lee Oldfield
“Certainly where there has been very little difference for the past five years or so, that doesn’t make any sense at all, good to see premiums coming for the finer wools which take a bit more care and time in production,” he said.
“It is rewarding growers that have focused on the finer end of the market.
“I don’t think the supply will increase, because so many people have left the finer end and either gone into broader wool or focused more on crossbreeds that are a meat sheep.”
The good season has also boosted the amount of wool produced at Avington, with the flock averaging 4.6kg.
“We’ve also had a particularly good season and that has resulted in our wool cut being better than it has for a number of years as well because of better feed for sheep,” Mr Henderson said.