Sheep Industry News April 2022

The Last Word KYLE PARTAIN Sheep Industry News Editor

Preparation More Important Than Ever for AmericanWool

I did my taxes recently and was surprised by a decent bill from the U.S. government. Turns out, I hadn't adjusted my withhold ing to account for some changes in my finances in the past year. As a result, I scrambled to make adjustments that would put me closer to the break-even point – which is where I like to be – when I file my 2022 taxes next spring. As producers around the country are shearing and selling their wool this spring, now is the perfect time to look at adjustments you might need to make in order to maximize profits from your wool clip. If you wait a few months – like I did with my tax adjustments in 2021 – chances are you'll forget about it altogether over the summer and fall – again, like I did – and you'll be in for some surprises next year at this time. After all, quality wool production starts with genetic selection and how sheep are raised, and carries through to the moment they are shorn and all the way until shearing the next year. One thing that shouldn't come as a surprise to producers is increased transportation costs. With soaring gas prices, labor shortages in the shipping industry and congestion at ports across the globe, there are plenty of extra costs involved with shipping American wool in 2022. We can all hope that many of these issues will be resolved by next year, but there's no guarantee of that at this point. You'll most likely have no way to control these costs, but you can plan for them. "While nothing has changed in our fees, the big variable is transportation," said Larry Prager of Center of the Nation Wool in Belle Fourche, S.D. "Who knows where the cost of freight is going? But it probably won't go down anytime soon. We were already seeing fuel surcharges. We sell most of our wool by private treaty, and that generally includes delivery to the East Coast or Texas. It's a good time to have a friend in the trucking industry." Keep in mind that other fees will apply, as well. Coring/testing charges and warehouse/buyer fees will also play into the economics of selling your wool. Generally, growers can expect the equation to look something like this: Grease Price X Yield – Handling Costs = Clean Price Deductions might also be factored in for short or stained wool and contamination by things such as colored fibers, paint brands or polypropylene. Well-prepared wools are still selling well, despite under performing manufacturing as the world looks to snap out of a COVID-19-induced funk and get back to full-scale operations in everything from meat to automobile to textile production. But coarser, contaminated and lesser-quality wools are facing even more difficulties than in the past. "Wools with poor yields, dust and high-vegetable matter were still exported in the past, but now they're getting passed over," Prager said. "Quality is an even bigger issue now than it was a year ago. A major factor is that we still have a lot of 2020 and 2021 wool out there. There's lots of wool in storage. And with the drought that we've been in around much of the country, I think yields are go ing to be down. "This is a market where the grower needs to take responsibility for the preparation of the wool clip," Prager said. "Shearing is a day where you can make a big difference in quality with just a little extra preparation." While preparation won't help you fine up your wool clip, it can greatly increase the yield. Minimizing contaminants is certainly a key element of preparing your sheep for shearing – minimizing hair and dark fiber, as well as foreign contaminants. Sorting sheep by wool type and/or breed before shearing and then packaging those wools separately is just as important. Simple steps such as keeping the shearing floor clean throughout the day's work can also make a big difference. Separating out tags/bellies, skirting and classing fleeces also allows producers to package their best quality wool together, and leads to a better return on the wool clip. This isn't anything new for producers. Many of you are already taking these steps and more to prepare your wool clips in a respon sible manner. But it's worth noting that these steps have become even more important in recent years as a lag in manufacturing left companies needing less wool. And lower demand means you need to take every possible step to make your wool clip stand out in a crowded marketplace. ASI offers a variety of resources in this area for producers. Visit SheepUSA.org/researcheducation-woolquality to learn more. Pro ducers can also use the ASI Market News app to check current wool prices and use the wool calculator to estimate what their wool might sell for in current conditions.

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