Joy as wool breaks through
Wool prices reached above 1000 cents/kg clean in both Australian and US currencies last week and it has been a long time coming, according to Matt Pedersen, managing director of Primaries WA.
“The country’s dedicated wool growers have had their fair share of inflationary pain, ” Mr Pedersen said.
“The recent price rises should be viewed as a fair return, not simply a 20-year high in $US without reference to the many years of offsetting cost of production increases.”
Farm management consultant Bob Hall said calculations for clients for 2008/09 found the cost of production to be $3.64/kg of greasy shorn wool.
“We also found a big range of between $2.38 and $6.59, hugely influenced by farm scale and less by wool price, ” Mr Hall said.
He said farms that were too small or too costly had a tendency to have higher costs of production.
Mr Hall said that since 1994 the cost of running one unit of dry sheep equivalent (DSE) has gone from $7 to $13.35.
“Although DSE unit costs have doubled, so has farm revenue from sheep.”
He recommended farmers consider the type of sheep they ran as part of their risk management practice.
“Dual-purpose Merinos have the ability to derive both wool and meat incomes, ” he said.
Mr Pedersen said wool prices over the 1000 cent/kg would attract more wool production back into the system which was required to secure the future of the industry.
He delighted in Primaries offering and selling the 1350 cent/kg greasy top-price line last week produced from Yarraween Grazing, in Duranillin.
He said the price represented a season high for all wool sold at the Western Wool Selling Centre and full credit should be given to many of the State’s producers who were facing tough seasonal conditions.
The Yarraween line was AWEX-appraised as ASF4 or best top making quality.
Mr Pedersen described the fleece wool as being 15.8 microns with a staple strength of 33-35 N/kt and length of 85m.
“The well grown and beautifully presented fleece measured a very narrow co-efficient of variation for both micron and length, ” he said.
Yarraween woolgrower Greg Cochrane said he had bred fine wool for more than 40 years.
“Fine wool combs very well and it’s a great joy to see it peel off the sheep and look so white and bright on the classing table, ” Mr Cochrane said.
“I am not sure if current prices will hold; it’s anyone’s guess of what happens next.
“Costs to grow wool have kept going up over the years and now meat production has become more important for farm revenue.”
Mr Cochrane said his Yarraween line was shorn from sheep bred by Misty Hills bloodlines.
He said he selected his rams for the finest of micron and better-styled type wool.
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