Australian Wool Enters the New Year Stronger
As the Australian wool industry moves into 2026, market conditions present a markedly different profile compared with this time last year, reflecting shifts in demand, pricing dynamics and broader economic signals. According to Australian Wool Innovation (AWI), these changes became increasingly apparent in December.
The 2025 year closed with solid momentum, and industry analysts suggest that as auctions get underway next week, prices have the potential to lift further, supported by tighter supply and improving sentiment.
Now, as wool auctions are set to resume following the industry’s three-week Christmas recess, confidence is firmer and decision-making at the farm gate is becoming more deliberate rather than reactive. But the industry is still facing its share of challenges.
Speaking recently on The Yarn, new AWI Chairman George Millington put it simply – producers have a choice, they don’t just have to grow wool. “Quite a few of them don’t just have to grow wool. They can crop, cattle, crossbred,” Millington said. “The only way to make sure wool growers are profitable is to assist them with managing their business. This is provided through on farm research and development. We do this to try and make life easier for them. And the other side of that is to try and ensure they get a fair price for their product and are remunerated.”
What he means is wool must continue to earn its place both in global markets and on farm, particularly when competing enterprises are offering strong, and sometimes immediate, returns.
The decisions growers are making now are shaped as much by seasonal conditions and cashflow as by longer-term confidence in wool’s outlook.
According to AWI’s General Manager, International, Stephen Hill who also Chairs the Australian Wool Production Forecasting Committee, conditions across Australia remain highly variable, and that variability is driving different supply responses.
“It’s a very mixed picture across the states,” Hill said. “Since the April meeting, WA has had a great season – fleece weights are up but production is still down compared to a year ago.”
In Victoria and South Australia conditions have been more challenging.
“Victoria and South Australia are really feeling it with a poor season – high ewe mortality, poor lambing and selling for cashflow,” Hill said.
In those regions, alternative income signals are influencing short-term decisions.
“High meat, skin and stock prices are tempting people to take the cash – especially if feed and water outlooks are poor.”
Hill is careful to stress this is not a single national story, but a reflection of how different regions are responding to local conditions.
Source: AWI