Year of the Dragon Wool Price and Demand

No one knows how wool prices will move after the Spring Festival; but many analysts predict that tight wool supplies and strong global demand for luxury goods, especially in China, will make demand for all types of wool strong this year and prices remain stable.

2012 was the first year of the Water Dragon since 1952. The dragon is prosperous when it meets water, and it can be seen in the eyes of others. It was certainly an auspicious year for debt-ridden Europe and the slowly recovering United States. It is said that the Year of the Dragon can bring good luck, success and ambition. In Chinese culture, the Year of the Dragon is an auspicious year for marriage, starting a business or having children. It is expected that China's birth rate will surge this year, which is also good news for wool, because with it, wool sales will increase. In 2011, exports of Chinese yarn and clothing to Europe and the United States declined. In fact, the demand in Europe is on the rise, but the varieties and blended raw materials in demand are more diversified.

Chinese exporters reported that the trend is that blended raw materials increase and price pressure increases. On the bright side, U.S. buyers are making summer orders in China, and there are signs that the U.S. economy is on the upturn. Mr. Wang Qiang, China Regional Project Manager of the Australian Wool Inspection Agency, said, "The negative publicity from Europe is unbearable, and Europeans are still sourcing wool clothing from China. As the two largest consumers of wool products, the economies of the United States and Japan are gradually picking up and are expected to increase their purchases of wool products in 2012." However, Mr Wang believes the biggest consumer market is China. He particularly highlighted the business wear market in China, which includes government agencies such as the police and military. The wool content of professional wear gradually increased. The uniforms of lower-level police officers are made of polyester fiber with a wool content of less than 10%, and the wool content is now expected to increase to 30%. The higher the rank, the higher the wool content of the uniform, usually 70% wool, 30% polyester. Therefore, business wear will become the main force of China's wool consumption. Mr. Wang predicts that wool prices will remain at a reasonably high level, mainly because of tight supply and demand, which will be the same as last year or even increase, which will inevitably put pressure on prices.