The US produces its own wool, but it does rely on a number of trading partners. And Australia happens to be a major one. Australia is the world’s largest producer and the second largest global exporter of wool. At the beginning of 2015, the Australian dollar depreciated against the US dollar, making the price of Australian products more attractive. Many wool buyers took advantage of this and the resulting increase in demand helped to strengthen prices.

A second contributing factor that affected the market price was supply. In 2014, wool production reduced due to Australian weather conditions, an extended dry period that lowered the birth rate of lambs and the corresponding wool production. As the dry weather conditions continue in Australia, wool production may again reduce in 2016. Future price increases may be on the horizon. The last 12 months have seen Australian prices increase by some 19 per cent.

Wool is a great fiber, as it absorbs moisture and keeps a layer of insulation next to the skin. Well-maintained wool is an extremely durable fiber. Around 80 per cent of wool is used for clothing, with the remainder going into production of carpets, blankets and upholstery.