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, or 135%.
British Wool CEO Andrew Hogley 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.
“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.”
British Wool, formerly the British Wool Marketing Board, is owned by approximately 35,000 sheep farmers in the UK.
It collects, grades, markets and sells British wool on behalf of its producers to the international wool textile industry for use in flooring, furnishings and apparel.
While the 36.4p/kg price is for wool supplied to British Wool in 2021, when compared with the typical price received for wool in Ireland last year there is a notable difference.
Irish lowland sheep farmers received a typical price of 15c/kg to 20c/kg (13p/kg to 17p/kg) in 2021, less than half the price paid by British Wool.
While quotes are not yet forthcoming from many Irish merchants for the 2022 clip, they are typically along the same lines as the last two seasons, at that 15c/kg to 20c/kg mark for lowland wool and as low as 5c/kg for grey or black Scottish Blackface wool.
Reports indicate that many merchants are holding off for as long as possible in quoting for wool in the hope that there may be more positive indications on demand from the Chinese market.
The resurgence in cases of COVID-19, which has led to fresh lockdowns in recent months, has had a negative effect in curtailing what was an already weakened market there.
In contrast, British Wool CEO Andrew Hogley said: “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 claims that the fact that its members’ wool has been through its grading system makes it quality assured and fit for purpose.
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.
“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.”
British Wool will also continue to offer free haulage for its members which was first introduced in 2021.
“This means that members who take wool to any of our drop points will not be charged onward carriage,” Hogley said.
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,” he said.