Positive outlook for wool in 2022

British Wool will be making payments worth £8.4m to its members for the 2021 clip, an increase to an overall average of 36.4p/kg.

Andrew Hogley, CEO said, ”The 135% average increase over the prior year is down to improved auction prices for wool over the last 12 months alongside a push to reduce operational costs.”

2021 Wool Grade Prices

“With the challenges the industry is facing we are really pleased that this year’s payments are an improvement.  Although the price is not yet where we would like it to be, it represents a huge recovery since the difficulties of 2020.  We continue to work hard to improve returns further for our members.”

“We are optimistic that the strong demand we have seen over recent months will be sustained, that the recovery in the wool market will continue through 2022, and that this will result in further price improvement for the 2022 wool clip.”

British Wool’s unique collective marketing system which collects, grades and tests wool on behalf of its farmer members ensures a consistent product for buyers and manufacturers whilst maximising the prices received at auction, he explained.  Alongside this, the organisation continues to drive demand for British wool across the supply chain and from consumers.

Mr. Hogley continued: “Everything we do has the primary aim of adding value to British wool in order to boost payments to our members.  As always, grade returns are determined by the average auction price for the season.”

Returns for the 2021 clip will be around 40p per kg for many core grades, around 30p per kg for Blackface wool and around 15p per kg for Welsh and Swaledale.  In all cases, this is a significant improvement on 2020 prices due to sales being badly affected by the pandemic.

Some speciality types such as Herdwick and Bluefaced Leicester will receive significantly higher returns.  Herdwick wool will return 80p per kg and Bluefaced Leicester will return £5.50 per kg.  An additional £1.00 per kg is also being paid out on most types of Organic certified wool.

“We recognise that our members have a choice to deliver wool to us.  On the whole our returns are competitive relative to the prices offered by our competitors and in many cases significantly higher,” he said.

“However, unlike our competitors we don’t make a profit from wool.  We sell on our members’ behalf and deduct the cost of marketing and processing.  The more wool we have to sell, the lower our costs per kg and the better the returns are for all our members.”

The free haulage offer introduced in 2021 will continue this year, he added. “This means that members who take wool to any of our drop points will not be charged onward carriage.”

Other improvements introduced last year which will continue for 2022 include the lower threshold for the volume premium payment. “Clips of 2,000kg or more will continue to receive an additional 4p/kg with further incremental increases for those delivering larger volumes.”

Concluding Mr. Hogley added: “British Wool’s primary aim is to maximise the value of wool for our members.  Now more than ever, it is crucial that farmers work together and market their wool through British Wool so that together, we can maximise returns for this year’s clip and beyond.”