Thursday September 29, 2016   CCWG branch locations across Canada *  Carleton Place, ON 1-800-488-2714  *  Cookstown, ON 1-866-458-4800  *  Lethbridge, AB (MB to BC) 1-800-567-3693  *  Saint-Hyacinthe, QC 1-888-796-4242
 


The co-operative grades and
markets close to 3 million
pounds of raw wool each year;
the majority of this coming from
Québec, Ontario and Alberta.

Each of the three general
classes of wool
(fine, medium and coarse)
are sold wherever the
best prices are available.

 

Download your copy today for a better return $$ 
on your 
wool clip.

Guide for the care & handling of your wool clip

Printed copies also available upon request.

 

 

Wool Market Reports

 Archives 2000-2012

 Archives 2013-2015

 

 

CCWG Update – Spring 2016

International Wool Market 

As we enter the 2016 wool marketing year, demand for wool has been reasonably good with any price movement mainly attributable to local currency adjustments to the USD. Wool prices in general have held up quite well compared to other textile commodity fibres which have all fallen in recent weeks. Oil based synthetic fibers in particular such as polyester, acrylic and nylon have all declined in price due to lower oil prices and excess production capacity.  Cotton prices have also continued to fall, due mainly to high global supplies.  World wide wool availability is quite constrained so there is no concern in the short term about over supply.

China continues to lead the way as the major global importer of raw wool but retail clothing sales in China and wool clothing exports are both lower compared to a year ago. Although there is currently slower economic growth in China, it is still projected at a very respectable 7% for the next two years. There is still uncertainty about the Chinese stock market and the transition of the economy in China from a manufacturing export model to one that is more focused on servicing domestic consumer demand. Elsewhere the economies of many of the major wool consuming countries have steadily improved during the past year which should result in improved prospects for wool in 2016.

At the present time stocks are reported to be quite low throughout the Chinese wool textile industry and mills remain very cautious with new purchasing requirements. This is mainly due to the slower Chinese economy and also a further tightening of credit availability which in some cases is hampering new buying activity. On the fashion runways wool continues to exhibit a strong presence and more wool is now being used by sport and leisurewear manufacturers. This is a very positive development but there is also concern in some quarters regarding changing global climatic patterns and the impact it may have on some wool clothing sales, in particular cold weather countries that are now experiencing milder than usual winter conditions.

World wide wool production remains at 70 year lows with no significant increase predicted in the near future. Australian flocks continue to decline due to ongoing drought conditions in many of the major wool producing regions. Although Australian wool production is projected to decline by 7% this year, it is predicted that sheep numbers and wool production will start to increase at a modest rate over the next few years.

Elsewhere, New Zealand wool production is expected to fall by 5% this year which follows a 2% decrease the previous year.  Sheep numbers have declined in New Zealand while other farming entities such as dairy have gained in popularity.

In 2016 the outlook for the overall global wool market is generally positive going forward, but there can always be unforeseen risks or uncertainties that may have a negative impact on the market and on consumer confidence.

Domestic Wool Market

 

The bulk of the 2015 Canadian wool clip has now been sold and at CCWG we are continuing our practice of orderly and disciplined wool marketing going into 2016. We have negotiated a number of forward contracts to our established international network of wool buyers in China, USA, Czech Republic, Bulgaria, India, Uruguay and Canada. Wool sales and currency hedging will continue to take place throughout the year, thereby enabling us to average our exposure to currency fluctuations and changes in the market place. As always, our standard of consistently graded and objectively measured wool is a key component to successful wool marketing and satisfied customers.

In other news, a few highlighted items of recent CCWG activities are as follows.

- CCWG sales for fiscal year ending February 29, 2016 just under 10 million dollars and wool volume is up 7% compared to the previous year. Paid out 7¢ per pound in profit sharing for the Shareholder Wool Shipper Loyalty Reward Program (SWSLRP) and 7% dividend to CCWG shareholders of record date December 31, 2015. See www.wool.ca for more information.  The retail division of the company has again achieved highly satisfactory financial results that have contributed to the companies’ positive bottom line..

- The company is expecting to proceed in 2016 with plans to build a new 14,000 square foot warehouse and retail facility at Broxburn Business Park which is located just outside Lethbridge, Alberta. This will replace an older company owned property located within the city of Lethbridge.

- Renovations were completed in 2015/16 at our retail locations at CCWG Livestock Supplies and Equestrian Centre, Real Wool Shop in Carleton Place, Ontario and Premier Choix Agricole in Saint-Hyacinthe, Québec. Improvements were also made to wool handling equipment at the Carleton Place wool grading facility

- Upgraded company websites and invested in more user friendly ecommerce platforms.

- As a sheep industry partner we continue to financially support initiatives such as All Canada Sheep Classic, Royal Agricultural Winter Fair, International Campaign For Wool, Canada’s Outstanding Young Farmer Program, Canadian sheep shearing competitions and shearing schools, numerous sheep shows and 4H competitions across the country.

- Established an annual National 4H Scholarship Program with 4H Canada to commence in 2016.

- Developed new printed promotional material to assist producers in improving the Canadian wool clip. A best practices wool video will be produced in 2016 that follows Canadian wool from the farm through to the final graded and baled product at Carleton Place.

- Appointed a new Agent to represent CCWG in Atlantic Canada, Antigonish Farm and Garden Co-op from Antigonish, NS.

- Looking forward at plans to commemorate the companies 100th anniversary which will be in 2018.

- On going implementation of the companies new long term strategic business plan.

For more information on the wool market or assistance in marketing your wool clip with CCWG, please contact the undersigned.

Yours truly,

Eric Bjergso, General Manager 
ericb@wool.ca  www.wool.ca

 

 

 

Wool Market & Business Update Summer 2015

     

    At the time of this writing, business conditions within the global wool textile industry during 2015 have improved in many ways compared to the results achieved in 2014.  Looking ahead the economic indicators for the major wool consuming countries is generally positive for the remainder of this year, which should be advantageous for sustained improvement of wool product demand and raw wool prices.  However there are risks that could affect this positive outlook given some of the fragile and volatile global economic and political conditions that currently exist.

    At this stage it is not known what effect if any the recent stock market correction in China or events in Europe ie Greece default and the depressed Eurozone economy will have on the wool market.  If consumer confidence waivers it could have a negative impact on retail sales which would ultimately affect wool demand and wool prices down the road.  In view of these recent events, analysts are forecasting that there quite likely could be a lot of volatility in equity and commodity markets for the remainder of this year.  As always, global currency exchange rates will be very much affected by this and will continue to be one of the principal drivers leading the direction of the wool market.

    China continues to be extremely important to global wool trade.  As an example, approximately 80 percent of Australian and New Zealand wool production is now exported to China for early stage processing.  Some mills in China are currently facing a shortage of cash flow and tight credit control is making trading conditions difficult.  Major changes continue to take place within the Chinese economy as it transitions from a manufacturing export model to one that is focused on catering to domestic consumer demand and service industries as the middle class continues to rapidly grow.  A large new middle class is emerging across Asia as a result of rising incomes.  Much of this growth is coming from China, of which the working population is larger than that of the USA and Europe combined.  The increase in purchasing power will have a strong effect on the global economy in years to come.  

    China’s annual economic growth rate is still expected to remain high at around 7% for the next two years which should be helpful for wool prospects.  With the significance of China to the  wool trade and the ongoing global uncertainty, it is impossible to predict the future direction of the wool market but in recent months it has held up reasonably well.  Global wool production continues to remain static at best and is expected to stay at around current levels, or decrease slightly. At this stage there is no sign of a sustained recovery in sheep numbers from any of the major producing countries.

    In 2015 CCWG has continued to forward contract the Canadian wool clip to world wide customers that we have established in China, USA, Europe, India, Uruguay and Canada.  Our standards of consistently graded and objectively measured wool has enabled CCWG to sell Canadian wool into these markets with trust and confidence, we are grateful for the excellent business relationships we have developed with a large network of international wool buyers.  I am optimistic that wool financial returns will be better for many grades in 2015 compared to the previous year.  

     For more information on the wool market or assistance in marketing your wool clip with CCWG, please contact the undersigned.

Yours truly, 

Eric Bjergso, General Manager  

 

  

Eric Bjergso, CCWG General Manager

Delegates attending the 27th International Wool Trade Fair & Information Conference

 

Mr Song Lin Zhang, Chairman China SDIC International Trade Co., Ltd (left) and Eric Bjergso, CCWG General Manager conclude some Canadian wool business

 

CCWG trade show booth attracts attention

 

 

 

The 27th International Wool Trade Fair & Information Conference was held in Qingdao, China.  Nearly 500 representatives from 26 countries attended the three-day conference from September 11th-13th, 2015.

\Nanjing Wool Market Conference is an annual meeting of the global wool industry that facilitates discussion on current industry issues, future developments, and new market opportunities.  Participants include growers, traders, primary processors, spinners, weavers and garment manufacturers, together with organizations involved in the wool related pipeline.

 

 

 

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