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British Wool to restructure after pandemic hits hard

Four grading depots are to close next season

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British Wool to restructure after pandemic hits hard

British Wool has announced a major cost cutting programme on the back of ‘extremely challenging’ wool market in order to maximise the value of producer’s wool.

 

Four of its grading depots will close next season, at Irvine, Porthmadog, Stamford and Liskeard with the wool reallocated to other grading depots. The annual savings were estimated to be £1.5 million per annum or 6p to 7p per kg.

 

Backlog

 

Despite managing to clear the 11 million kg of unsold wool they had at the end of April, which had placed pressure on prices to farmers, British Wool acting chief executive Andrew Hogley said prices were still severely depressed.


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Mr Hogley said: “The global market faces an oversupply of cross-bred wool, this is mainly from New Zealand but also from other European markets.

 

“Although we have seen some more positive signs in recent auctions on some wool types, carpet wools remain under a great deal of pressure.”

 

He highlighted the contract carpet market which served the hospitality trade was ‘extremely depressed’ due to closures during the pandemic.

 

Services

 

Mr Hogley emphasised the service level to producers would not change.

 

“Where we close a grading depot we intend to replace this with a new intermediate depot in the nearby area. This will ensure producers still have a local drop point for their wool with no onward haulage charges.”

 

All affected producers would be contacted ahead of the new season and he confirmed they would continue to take all types of wool from any producer.

 

He also urged producers to stick with British Wool.

 

“Without British Wool returns for wool would be permanently low and many producers would have no market for their wool. Rest assured things will improve and British Wool will be working hard to support the recovery of the wool trade in order to maximise the value of your wool.”

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