After a tumultuous few months the wool market is returning to stability with prices on the rise again at the last two British Wool Marketing Board (BWMB) auction sales of British wool.
Speaking at last week's BWMB annual conference in Edinburgh, BWMB Chairman Malcolm Corbett told delegates that much like the rest of the sheep trade the wool market had been a victim of its own success in the previous six months.
"Strong wool prices last year and in the first quarter of this year led to slowing sales and lower clearance rates at BWMB auctions," he said.
"As a result, the market dipped below where we expected it to be - the Board Sales Indicator fell from a high of 184 p/kg last year to 112 p/kg, before rising to 118 p/kg at the last sale on the back of an improved New Zealand market.
Mr Corbett said tough trading conditions across the world had led to the market dip . "The UK carpet market is struggling with low consumer confidence and the Chinese market has slowed dramatically, leading buyers to try and force prices down.
"But with little demand BWMB has resisted slashing its auction reserve prices as it wouldn't have had any effect on sale clearances. Instead we chose to maintain auction prices and ended the last sales season with higher than anticipated stocks."
The situation though has been repeated across the globe, said BWMB chief executive Ian Hartley. "New Zealand prices have fallen heavily too, with prices in July falling by 20%, to levels 45% below last year's prices."
But there are reasons to remain upbeat, said Mr Hartley. "The Campaign for Wool is capturing the imagination of manufacturers, retailers and consumers across the world and we are extremely grateful to the Prince of Wales for his continued dedication to the CfW.
"The recent CfW launch event in New York was a major success with sheep taken in to central Manhattan to capture the imagination of the American public. We see the USA as a major market for wool as just 2% of the floor coverings in America are wool based. Because of the size of the market just a small shift in demand in America would have a massive effect on the wool market."
Mr Corbett said the BWMB remained confident in the future of the wool market and said that with wool currently accounting for just 1.5% of the world fibre market there was still massive scope for growth. "Wool supply across the globe is static, so if we can reinvigorate demand prices will undoubtedly have to rise in line with a competitive marketplace."
Meanwhile, away from trading issues he said the BWMB had enjoyed another successful year in shearing training, with more than 1100 trainees taking part in BWMB training courses in 2012. "The quantity and quality of our young shearers is a great legacy for the Board. Shearing Training Manager Colin MacGregor and his team deserve our congratulations."
