Sheep Industry News August 2023

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for total supplies to begin the second half of the year. Both should point to some opportunity for improved prices.

WOOL Since the last article, the 2022-23 Australian wool marketing year has ended and the 2023-24 year has begun. The marketing year tended to end with slumping prices across all grades. For example, 21-micron wool quoted in U.S. dollars per pound was $3.91 per pound for the week of June 30. That was 16 percent below the same week a year ago and 7 U.S. cents per pound below the week before. Finer quality wools experienced larger week-over-week price de clines than did coarser wools. For example, 17- and 18-micron wool declined by more than 20 U.S. cents per pound while 26 and coarser wools declined from 1 to 4 U.S. cents per pound. There continues to be large supplies on the market pressuring prices lower. The Eastern Market Indicator dropped to $3.39 U.S. per pound for the week of June 30. That was its lowest level since October 2020, when it was $3.30 U.S. per pound. The market at that time was on its way up while today prices have been on a downward trend. As usual, week-to-week fluctuations in exchange rates do impact relative prices between the United States, Australia and other coun tries. But, likely more important to overall price levels are expecta tions for consumer demand. Some countries continue to struggle with weak economies and relatively high inflation rates. Expecta tions for better economic growth in Europe and China would likely improve prices, but those positive expectations have been lacking. SUMMARY On balance, there are a number of positive factors in the lamb market. Reduced imports and less lamb in storage than compared to the five-year average indicates some supply reduction. While domestic slaughter is above a year ago, lighter weights are cutting production. The overall supply situation is improved and is pro viding some support for prices. The key for prices will be growing demand as the economy improves.

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