THE wool industry is beginning to see a recovery in prices paid – but the value still has some way to go to fully recover, an industry body has said.

A surplus of wool on the market during the coronavirus pandemic led to prices falling sharply – to the extent that shearing animals was costing farmers more than they would make from the product.

Now, as the shearing season gets underway, British Wool has published details of producer payments and confirmed that all producers who delivered wool to a grading depot or intermediate depot in 2020 will receive a payment.

And British Wool’s stock overhang from 2019 has been successfully cleared and as the market starts to recover, British Wool will also close the 2020 clip year with a minimal stock position.

Since February auction prices have also started to recover. The average auction price is now around 67p per kilo compared to 50p – 55p for most of the last 12 months.

British Wool chief executive Andrew Hogley said: “Despite the challenging year we have had, British Wool is still making a payment to producers for their 2020 clip.

“The total return averages 15p per kilo.

“This is still a long way below where we need it to be but we are optimistic that we will see a further price recovery through the course of the next year.

“A healthier stock position, reduced cost base and recovering auction prices puts British Wool in much stronger position to deliver better value for our producers in 2021.

“Also, following the completion of the restructure, we have enhanced our service offer by opening a number of new collection sites this season. In order to support our service offering we are abolishing onward carriage fees at all of our collection sites from this season.

“British Wool’s shearing courses are also resuming this year. We see this as an essential part of the support we provide for the industry.”

When the first Covid lockdown was imposed, the wool scouring plants in the UK closed and manufacturers stopped processing. Exports were also put on hold.

British Wool faced a situation where, in effect, there was no market for the product and as a result, closed the 2019 season with 11m kg of stock unsold.

Jim Robertson, Chairman of British Wool and Dumfries sheep farmer added: “British Wool is a cooperative and we firmly believe that the collaborative marketing of the UK wool clip is the best way to deliver value for wool producers.

“If anything, this principal is even more essential today than it was when British Wool was established in 1950.

“The wool clip needs to be sorted and amalgamated into commercial weights if it is to be used by manufacturers and achieve value for producers.”

British Wool is based in Bradford and is owned by approximately 35,000 sheep farmers in the UK.