(May 1, 2012) Wool prices have pulled back from the peaks in mid-2011, but since October have been remarkably resilient in spite of the very difficult demand conditions. In contrast, prices for other fibers have fallen quite sharply in the past few months.
Between October 2011 to the end of March 2012, the Australian Eastern Market Indicator increased by 7 percent, with the strongest gains for prices in the medium Merino range. For example, the 23-micron price guide has lifted by 25 percent between October and March.

In contrast to these strong gains, the prices for competing fibers have fallen. Cotton prices were down by 10 percent, viscose prices fell 19 percent, polyester prices were down 4 percent and acrylic prices were flat.

The chart shows the change in annual average prices for various fibers, highlighting how well wool prices have performed.

The much better performance of wool in general, and medium Merino wool in particular, is due mostly to the low and falling production of wool. Other fibers are seeing production increases, which combined with the poor demand conditions, are resulting in lower prices.