The latest British Wool auction held on 5 March met a much more challenging trade than in recent months, with the clearance rate and prices paid reducing significantly.

British Wool reports that over the last six months, clearance rates recorded in auction sales increased to and steadied at a high level of about 90%, while the wool price index lifted by over 25%.

The organisation says that this resulted in wool prices climbing above comparable prices, stating that in this context it is not surprising that demand for British wool was weaker in the sale on 5 March.

It says that it “was prepared to meet the market to a point, with the index falling back by 4%, but with a strong stock position, it opted to take wool back into stock rather than accept a more significant price reduction”.

Prices for the catalogue offering as a whole were approximately 4% lower than in the previous sale, with the organisation taking one third of the offer back into stock.

This resulted in a clearance rate of 65.4%, with 0.751m kilogrammes (kg) of the 1.147m offering selling.

The average price of clean wool is running at £1.23/kg (€1.44/kg at 85.3p to the euro), while the average price of greasy wool is 82p/kg (96c/kg).

Sales progress

British Wool reports that it has now sold 13.6m kg of its 2023 wool clip, equivalent to 65% of its anticipated supply for the 2023-2024 season.

It says given the stronger sales in recent months, it is not under any pressure to sell into a weak market.

“The offer [on 5 March] amounted to 1,147 tonnes spread over 162 lots. Of this, 751t spread over 104 lots sold. The 58 lots taken back into stock were a broad mix of types including fine, medium, mule, hill and mountain wools.

"The average price dropped back to 82p per kg, but many core grades still traded above £1 per kg.”

The organisation says the higher price for core grades is welcome, but it stressed that its members need to see significantly better returns across all types to ensure that all growers present their wool for sale.

“Several mountain wool types are struggling to cover their handling costs. UK farmers require an average auction price of around £1.20/kg (€1.41/kg) to cover their costs of shearing."

Producer returns

Producers trading their wool with British Wool will receive payment for the 2023 clip in 2024 once the sales season comes to an end.

The return producers receive is based on the annual sales value of that wool minus handling costs.

The 2023 wool price for 2022 season wool was in the region of 30p/kg for core grades (35c/kg), 20p/kg for Blackface wool (23c/kg), 10p/kg (12c/kg) for Welsh Mountain and 8p/kg (9c/kg) for Swaledale.