The Australian Wool Industry in 2018
Canstar notes that Australia is one of the world’s biggest wool producers, producing around 25% of the wool sold on the world market[1]. Australia along with the wool industries in almost every advanced, wool-consuming country, is set for a respectable economic performance in 2017-2018. [2]
Wool prices are forecast to rise as a result of growth in global demand continuing to exceed growth in supply with Australian wool exports forecast to increase by 4% to 446,000 tonnes.[3] The value of Australian wool exports is predicted to increase by 20 per cent to $4.3 billion, reflecting higher wool prices[4] with China as Australia’s main export destination for raw wool.
According to ABARES, during the same period (2017-2018), the Australian Eastern Market Indicator (EMI) wool price is forecast to rise by 15% to average 1,630 cents per kg. This higher EMI is expected to be supported by higher prices for fine and superfine wools, reflecting strong growth in global demand relative to growth in the supply of fine wool used in the manufacture of these items.[5]
[1] Canstar website report: Agriculture Industry Outlook for 2017-2018
[2] ABARES 2017, Agricultural commodities: December quarter 2017. CC BY 4.0
[3] ABARES 2017, Agricultural commodities: December quarter 2017. CC BY 4.0
[4] ABARES 2017, Agricultural commodities: December quarter 2017. CC BY 4.0
[5] ABARES 2017, Agricultural commodities: December quarter 2017. CC BY 4.0
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The Australian Lamb Industry in 2018
Industry experts[1] predict that lamb meat prices will rise in 2017-2018, reflecting continued high demand for Australian lamb in key export markets.
ABARES, forecasts 2017–18 sheep prices to increase by 6% to average 440 cents per kg and continuing flock rebuilding and restocker demand in most regions.[2] The national sheep flock is forecast to grow despite dry seasonal conditions in winter and early spring.
Live sheep exports are expected to grow slightly to about 1.9 million head, with the Middle East being the main export market.[3]
Australian lamb exports to the United States, China and Middle Eastern countries are forecast to grow, with volumes increasing by around 2% to 259,000 tonnes and the value of exports forecast to increase by 7% to $2.1 billion. ABARES notes that increased Australian exports to these destinations will be aided by a forecast of the continuing lower exports from New Zealand.[4]
Canstar[5] points out, however, that Australian lamb still has a long way to go before it catches New Zealand, with NZ exporting almost 230,000 tonnes of sheep solely to the European Union — almost as much as Australia exports globally.
[1] Canstar website report: Agriculture Industry Outlook for 2017-2018
[2] ABARES 2017, Agricultural commodities: December quarter 2017. CC BY 4.0
[3] ABARES 2017, Agricultural commodities: December quarter 2017. CC BY 4.0
[4] ABARES 2017, Agricultural commodities: December quarter 2017. CC BY 4.0
[5] Canstar website report: Agriculture Industry Outlook for 2017-2018
