Wool production is at a 70-year low globally but is still out-performing most other commodities. Global demand will drive what happens to prices in the next 12 months. Retail sales around the world are seeing slower growth rates.

The particular downturn in super fine-wool prices is because supply is increasing more than demand is. Once there is a bit of a pull back in production of super-fine wool, there will be a more sustainable balance and more sustainable prices.

China buys 70 per cent of Australia's wool clip, but there is increased demand in Europe. The rising European interest is acting as a counter to Chinese dominance in the market. A shift in the global, China-dominated demand for raw wool will push up wool prices everywhere.

The number of China's wool processing plants has dropped from 2,500 to 2,000 in five years. Sportswear has traditionally been dominated by synthetic fibers. However natural fibers like wool provide better advantages. Wool keeps a person cool when it's hot and warm when it's cold, something synthetic fibers have never succeeded in doing. Another problem synthetics haven’t solved is smell. Wool happens to be anti-microbial and anti-odor by nature. That gives it a huge head start over synthetics.