Australian Wool Output Will Slump to 84-Year Low, Group Says

By Madelene Pearson

Dec. 12 (Bloomberg) -- Wool production in Australia, the world’s top producer and exporter, will drop to the lowest in 84 years as drought cuts into flock numbers.

Shorn wool output may be 370 million kilograms in the year ending June 30, 2009, the Australian Wool Production Forecasting Committee said in an e-mailed statement. That compares with its September forecast of 375 million kilograms and is the lowest since 1924-1925.

Production has slumped after years of drought forced farmers to sell livestock they couldn’t feed and as producers switched to grain amid wool’s 22 percent price slump this year. Exports are forecast to drop to the lowest in at least two decades.

“The sell-off of sheep continued over winter, with sheep slaughterings across Australia up by 10 percent in the September quarter, due to the dry seasonal conditions and concerns about feed availability,” Russell Pattinson, chairman of the committee, said in the statement.

Still, widespread rainfall in November may improve summer feed and water supplies and help to slow the reduction in sheep numbers, the group said.

Today’s forecast is 7.5 percent lower than the 400 million kilograms produced last year, which was the lowest in 64 years, according to Chris Wilcox, the committee’s secretary.

To contact the reporter on this story: Madelene Pearson in Melbourne on mpearson1@bloomberg.net