The final sale of the 2016/2017 season was held by the British Wool Marketing Board (BWMB) on Tuesday. The clearance rate recovered from 78% in the May sale to 96%, but it must be pointed out that there was a much smaller offering of 1.46m kilogrammes compared with over 2m kilogrammes in the last sale.

The sale report described the offering as being varied, with many small lots of different grade wool. There were price increases and decreases across different categories, with many of the finer types reducing in price.

This reduced the cumulative end-of-season by 1p/kg to £1.14/kg (€1.31/kg at 87p to the euro), despite the actual sale average increasing 2p/kg to £1.08/kg (€1.24/kg).

The price returned to farmers includes a reduction of 30p/kg to 35p/kg to cover costs, such as handling, processing, marketing, etc, leaving the producer price in the region of 80p/kg to 85p/kg (92c/kg to 98c/kg).

New-season wool prices remain challenging. Volumes traded to date remain low, with mixed weather in the last week greatly disrupting shearing activity.

Quotes for wool still remain at 60c/kg for lowland wool, with some occasional reports of 65c/kg paid for wool that is known to be of good quality and packed sufficiently. Merchants are advising farmers to be wary of shearing sheep with damp or wet wool.

As bad as prices are, merchants have no interest in damp wool, with drying nearly impossible to complete. There is very little Scotch wool on the market and opening season prices are quoted at 30c/kg to 35c/kg. Poor Chinese demand and an unfavourable exchange rate for UK trading continue to be the reasons for current price pressure.

There is also variation in the costs reported to shear sheep. The general price reported is €2.30/head to €2.50/head for average-size flocks, with scope in cases to complete deals for large flocks. The lowest prices reported are €2/head to €2.10/head for flocks with large numbers and good facilities and clean sheep that allow faster shearing.