A more subdued wool market took place last week across Australia as the currency movements tended to be less favourable than in previous weeks.
The best quality wools and those with the desired additional certification remained very strong, but the 'bread and butter' wools eased marginally in local currency terms. The overall market closed 14 cents down, but in an affirmation of confidence prices were slightly higher in USD terms.
There were some larger movements, but most Merino fleece types were within 10c of the previous week's levels. Again knitwear types, pieces, bellies and the longer lambs were in strong demand by the trade and fared well while crossbreds and cardings were more or less unchanged.
In NZ the small quantities on offer continued to keep buyers on their toes, but failed to provide enough of a spark to push prices higher, as the poorer styles decreased in prices enough to offset the improvement for the better wools.
The shutdown of some mills in China has temporarily snuffed out the small flames of recovery, and the industry keenly awaits a resurgence in demand.
In South America the meagre supplies of greasy wool are mostly being held by growers not interested in selling.
A lot of these wools are 24 to 33 micron and current prices are not exciting compared with previous years, especially given the taxation and inflation implications of selling wool at present, especially in Argentina. New shearing will not begin for another month or two.
Shearing is in full swing in Europe but with the exception of the best of the German wools, not much of this wool can be considered for use in apparel. Lower grades of German wool are being turned into organic fertiliser by adding heat and pressure to create pellets, which can then be used for agricultural applications.
The Chinese domestic Merino wool will soon be harvested, but with medium Merino prices hovering around the 40th percentile for prices over the past five years, Chinese woolgrowers will not be leaping for joy.
It will provide processing mills with some cheap filler material for lower grade fabric and uniform material when it finally reaches the processing scene in late June or July.
The growers in South Africa remain locked out of China as no progress has been made to create protocols that satisfy the Chinese health authorities about their Foot and Mouth status.
Meanwhile processing mills across the world are running as best they can. Labour shortages are reported in almost every domicile, and are forcing a rethink in some cases.
In Vietnam many workers deserted the larger cities, rather than face further COVID-19 lockdowns with no financial support in an expensive environment.
Some garment makers, where labour is a larger consideration than infrastructure or machinery, are relocating factories to rural locations to entice workers.
This will add ongoing transport challenges for everyone in product manufacturing around the globe. Some fabric buyers are told the wait times for their orders will now be six to eight months, far more than the usual three to four months.
This is presenting huge challenges to meet the seasonality of garments, and retailers are desperately seeking alternative suppliers.
Many textile mills pivoted to produce face masks and PPE when their usual orders dried up, but to find an alternative supplier or raw material when the pipeline dramatically slowed is more challenging.
