Lamb and wool outlooks may be a double blessing

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…the price increase (is) “some improvement” compared to a few years ago, when things were “pretty grim.”



Wool prices have been in the doldrums for so long that sheep producers tend to ignore it as they prepare their budgets. If anything, shearing is a cost rather than a revenue item.

But after a dramatic drop in price with the 2008 economic downturn, wool prices seem to be headed up at the same time as lamb prices are at undreamed-of levels and demand exceeds supply.

World wool prices took a 70 per cent dive in 2008, but prices are picking up again, says Eric Bjergso, general manager of the Canadian Co-operative Wool Growers, which has a wool collection depot in Lethbridge. Australia, a major sheep producer, has cut sheep numbers to the lowest level in over 100 years because of drought that’s lasted around nine years and hasn’t ended, even though some areas have had rains.

On the other hand, the strong loonie has dampened any notions of a boom in wool prices.

Bjergso calls the price increase “some improvement” compared to a few years ago, when things were “pretty grim.” He notes that world wool stockpiles have dropped by half from mid-80s levels of five million bales (a bale is around 1,200 pounds).

Over 90 per cent of Canada’s wool production is exported, mostly to China, the kingpin in wool markets, buying 80 per cent of Australia’s production. India is also a significant buyer. Only a few woolen mills are still functioning in Canada, in the Maritimes and in Alberta. The machinery in them is old – the one at Carstairs is virtually a working museum.

Bjergso says higher production in Canada would help in making sales and help balance demand, which at present far exceeds production. Despite being a small player in world markets Canada’s wool is sought after for its “spring” – the ability to retain its microscopic ringlet shape, which gives textiles bulk. Blending this wool allows processors to produce blends with specific characteristics for particular products and prices.

There’s increased interest in using wool in home construction because of concern about carcinogens and carbon emissions. Researchers are working on use of wool as a “green” insulation.

The price for a fleece depends on the grade of the wool, mainly the fineness and length of the fibres, with medium or fine wool bringing 80 cents to $1.30 a pound and coarser types only 30 to 45 cents. Coarser fleeces are also lighter, maybe only four or five pounds, because the wool is more open and sparse. A fleece from a fine-wool breed is denser and weighs 12 to 18 pounds. Wool is downgraded if the offsorts – the belly and any discolored wool – is not separated, or for stains. Each fleece is bundled separately and all are packed tightly into eight-foot jute sacks – each holds 200 to 250 pounds of wool – and sewn up at the top.

All of Western Canada’s wool is shipped to Lethbridge where sacks are compressed and baled before being sent to the co-op’s grading centre in Ottawa. The Wool Growers is Canada’s oldest co-operative, founded in 1918. It buys most of the raw wool produced in Alberta.

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