The volume of stock being sold at British Wool’s auctions has recovered in recent weeks, although prices remain severely depressed.

“From February to May we were selling very, very little wool. From June it started to pick up and from October we sold more wool than we had sold since the start of the year,” said Graham Clark from British Wool.

At the start of the summer, British Wool had an overhang of 11m kilos from the 2019 season, but this has now been reduced to around 1m kilos of mainly mountain and hill wool.

However, the coronavirus pandemic has left prices on the floor and Clark is not expecting a quick bounce back. He described it as “by far the most difficult market situation” in the 70-year history of British Wool.

“I suspect we will have some ups and downs over the next 12-18 months with COVID,” he said during an online event organised by the National Sheep Association.

A major problem for the coarse wool trade is the demand for contract carpets, which are used in the likes of hotels, cruise ships and airports.

“Demand for contract carpets is going to be soft for some time, it could take 18 months or two years to recover,” Clark said.

Price recovery for finer wools, which are used in clothing, could be quicker than coarse wools.

“We are seeing some recovery but again prices are really, really low. The average price selling out of our auctions is low 50s [p/kg] and that is just the auction price, it’s not the return to the producer,” Clark said.

Around half of British Wool’s stock is sold within in the UK, 25% goes to China, 15% to the EU, 5% is exported to Japan and the remaining 5% goes to other countries worldwide.

The outlook for export markets is also bleak as New Zealand alone has an overhang of 25m kilos from last year. “There is a massive oversupply,” Clark said.