Farmers still losing money on wool with fleeces below £1

The sheep sector continues to make a substantial loss on wool with current prices well below the cost of shearing.

Wool was valued at just 74.8p/kg at the latest British Wool auction in May, falling by 6% on the previous auction and down by more than 20p/kg since last November.

Returns for British Wool members are due to be similar to last year for the 2023 clip, with medium wool ewes remaining at 32p/kg and Welsh mule wool at about 30p/kg.

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This means farmers will typically be receiving less than £1 a fleece.

Some wool grades have faced further cuts, Swaledale wool will fall from 8p/kg last year to just 5p/kg.

Meanwhile, estimates by the wool board suggest that wool prices would need to be at least 120p/kg for sheep farmers to cover shearing expenses alone.

British Wool chairman Jim Robertson said: “Prices strengthened in the autumn, but have weakened again over the past two months, with mountain wool types struggling all season.

“British Wool’s auction prices for the season are on a par with New Zealand.”

The 2023 wool clip was smaller than previous years due to lighter fleeces, and the 2024 wool clip is expected to come onto the market from July onwards.

Mr Robertson said: “Our typical member delivered 10% less wool in 2023 than in 2022.

“The decline in wool volumes reduced our returns by about 7p/kg.  If we had handled the same weight as the previous year, many grades would have been up 20p a fleece.

“Every additional 500t we handle improves returns for all members by 1.5p/kg.”

Mr Robertson added: “The rise of oil-based fibres over recent decades has driven down the value of wool.

“The world is however now starting to wake up to the environmental damage these fibres cause, and the sustainability credentials of wool.”