Non-mulesed wool premiums surge ahead

Premiums for non-mulesed wool have more than doubled in the last two years


Wool
G Schneider Australia managing director Tim Marwedel. Photo by The Schneider Group.

G Schneider Australia managing director Tim Marwedel. Photo by The Schneider Group.

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Premiums for Australian Merino wool declared as coming from non-mulesed sheep have doubled since 2016.

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Premiums paid for Australian Merino wool declared as coming from non-mulesed (NM) sheep have doubled since 2016 according to the latest figures from Australian Wool Exchange (AWEX). 

AWEX senior market analyst Lionel Plunkett said the average premium for 20-micron wool declared as non-mulesed in 2018 was 46 cents per kilogram, compared to 21c/kg in 2016. 

For 19-micron categories, non-mulesed wool in 2016 saw premiums of 13c/kg, but in 2018 that had risen dramatically to 48c/kg. 

Although the supply of non-mulesed Merino fleece continues to be heavily slanted to the finer combing categories, with minimal broad Merino volumes declared as NM, Mr Plunkett believes the demand is now coming from all sectors in the market. 

G Schneider Australia managing director Tim Marwedel said it is difficult to measure and it's important to note that it is not premium based, it is 'yes or no'.  

"It is complicated to be able to say that any particular lot gained a premium simply because of it's mulesing status," Mr Marwedel said.

"I might be buying it because it is a very nice lot, a competitor might be buying it because it's a certain micron and someone else might be buying it because it is non-mulesed. 

"That's the open market and that's quite normal.

"But if you can identify two lots which that look the same, the non-mulesed lot certainly sells for more. 

"I would say, as a proportion of good wool, there is probably more in the very fine end, 16-micron and finer, so the premiums in that end probably aren't as great as they would be in the 18 to 20-micron which is the main commercial area of interest." 

Yet with such a strong development on the demand side, it is the supply side which is limiting the expansion of NM premiums or discounts for non-declared/mulesed wool.

The latest figures show the total number of bales offered at auction with a declared mulesing status of NM for the period July 1, 2018 to January 31, 2019 is 93,330

That was a decrease of 10,525 bales or 10 per cent, over the corresponding period in the previous season.

"Obviously the overall production of wool was lower for that period, so it would be hard to see an increase in NM wools as it was such a sharp decline overall," Mr Plunkett said. 

"Overall volumes of bales sold at auction for that period were 17.3pc lower than the previous year." 

The story Non-mulesed wool premiums surge ahead first appeared on Farm Online.

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