Australian wool prices are on the up ahead of the industry’s first week-long recess for the Chinese New Year.

The industry’s benchmark Eastern Market Indicator (EMI) improved 16 cents this week to 1,693 cents per kilogram, which is its highest level since 2019.

The EMI has now risen 152c/kg (10 per cent) since the start of this year.

In its weekly summary, Australian Wool Innovation (AWI) said “solid price gains” were occurring despite the rising Australian dollar.

It said China’s market share had increased to 88.4 per cent of Australian wool exports, but one of the major factors determining price was Australia’s dwindling supply.

“To put the loss of Australian wool production in perspective, over the past two years the volume of wool grown in Australia has fallen by the magnitude of the entire South African wool clip,” it said.

Graph showing wool price rise

Both the Western Market Indicator (WMI) and Eastern Market Indicator (EMI) show the price of wool is on the rise.  (ABC Landline/AWI)

Break for Chinese New Year

AWI’s general manager international Stephen Hill said wool auctions would now take a week-long break for the Chinese New Year period — a first for the industry.

“For the last 15 years or so China has become the dominant destination [for Australian wool] and now takes over 85 per cent of wool exports,” he said. 

“The Lunar New Year is the most important holiday in China and [buyers] would love to take the week off, relax and not keep an eye on business.

“So we’ve been able to satisfy this reasonable request from our major client.”

Sales will resume on February 24.

Loading…Genuine demand

Mr Hill spent the past month in China and said demand going forward looked positive, with wool going into traditional categories such as men’s suiting, but also emerging markets such as sportswear.

“Wool is definitely in fashion and we’re seeing demand across the board,” he told ABC Landline.

“There are so many new categories that are using wool.

“There’s so much wool going into blends now and there’s a boom in wool-cotton … and even if the percentages in the blends are low, they’re in mass market areas and selling volume.”

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