John Ive, with a draft of his young ultrafine Merino ewes on "Talaheni", Yass. Mr Ive aims at growing heavy fleeces measuring less than 15 microns.

Comparison of relative returns for fine micron

The superfine end of the wool market, that is those especially bred and prepared fleeces measuring less than 16 microns, has always been dependent on relatively few discerning buyers producing high value garments, and prepared to pay high prices for the raw wool.

It is also a segment of the wool market which attracts most attention for the high prices paid in real terms for a bale or two throughout the wool selling season. 

But dedicated ultrafine woolgrower, John Ive, “Talaheni”, Yass, who has made a study of the relative returns of each micron class for the 2015-16 season from values supplied by Australian Wool Exchange (AWEX), said his analysis highlights the depressed returns of ultra and superfine clips across the Merino micron range. 

Following his career with CSIRO, he has focused his attention on producing ultrafine wool, attracted to growing an elite product for its aesthetic and historic connections.

“But I still have to make a profit, and like all ultralfine woolgrowers we find it hard to to sell our wool above the cost of production,” Mr Ive said.

“For a number of years the financial return from ultra and superfine clips has declined relative to broader clips.”

Using calculated clean fleece weights and the AWEX price schedule, Mr Ive’s study shows the return per head across the micron range indicates a steady decline in return as fibre diameter declines from 24 to 15 micron, after which there is a solid increase with 13 micron and finer actually receiving the highest return across the range.

It is perhaps not suprising, because of the extra weight of fleece grown by Merinos in the broader micron range, Mr Ive said his study indicates the return from a 15 micron clip is around $15/head less than that for a 24 micron clip.

“Furthermore, only rare specialist clips 13.5 micron and finer exceed the 24 micron return,” Mr Ive said.

“However, such quality clips are often associated with a higher cost of production due to their nature.”

To further explain the gross return differential, Mr Ive said given the shortfall in returns for most of the micron range, the clean fleece weight in the 15 micron range would need to be 3.3kg to achieve parity with the 24 micron fleece.

“However, that average weight is some 0.8kg or more than 25 percent more than current wether trial data demonstrates,” he said.

While this analysis has been restricted to average wool cut and average prices, Mr Ive wished to stress there are a number of issues which individual producers need to take into account when deciding the relevant micron range for their Merino sheep.

In his study of the returns across the micron range, John Ive noted the size of the super and ultrafine clip is limited and the small quantities produced means prices are often volatile and more uncertain in an already fickle market.

“The quantity of wool produced below 16 micron is less than one percent of the national clip,” Mr Ive said.

“Unfortunately, the low quantity grown leads to greater price variability and uncertainty among the lower micron range.”

I addition, Mr Ive said discounts for ultrafine clip imperfections such as staple strength, colour and length are larger than for the broader micron range.

“But lower micron sheep are able to be stocked at a higher rate compared to their broader counterparts, and therefore their return per hectare is marginally better than the per head comparison suggests when compared to broader micron sheep,” Mr Ive said.

“However the country on which the specialist sheep perform best, will generally not enable the broader Merinos to realise their potential, which includes carcase weight and lambing percentage considerations.”