Wool Included in Loan Deficiency Program

Like much of the rest of the U.S. economy, the wool markets in our country have hit unprecedented hard times. Currently, wool use and exportation of wool is extremely poor.

There are two main reasons for this situation. For many years, China has been the major buyer of U.S. wool. A current trade war between China and the U.S. has taken a heavy toll on our industry. China has put a 25% retaliatory tariff on imported U.S. wool, making our wool more expensive than wool from other countries. India is the number 2 wool buyer in the world and at this time that country is not buying much wool due to a major outbreak of Covid.

The other reason for poor wool sales is the current economic situation created by the pandemic. Sales of wool products are not good right now. Fine wool (less than 25 microns) that is used in making high quality clothing is moving a bit. However, medium and coarse wool is not moving and is filling up the wool buyers’ warehouses. Unfortunately, the bulk of the wool that comes into our local PA markets is medium grade (26 to 30 microns) wool. It is hopeful that this situation will change in 2022.

One bright spot concerning wool has come from the U.S. Department of Agriculture. The USDA has extended the Loan Deficiency Program (LPD) to include wool this year. If you register with your county Farm Service Agency (FSA) before you bring your wool to the pool, you will be guaranteed a certain price for your wool at whatever the current rate is at the time of your sale (pool date). At this time the rate is $0.40 per pound. This is subject to change. The wool must be sold before any payments are made. We recommend that if you wish to participate in the LPD, that you register in your county FSA office now, so it does not get forgotten.

Producers may be looking for a wool pool to market their wool that has been kept in storage for the past two years. Instead of holding a spring pool, The Berks County Sheep & Wool Growers will be holding their pool this fall. The dates are Friday, October 22 in Chester County and Saturday, October 23 in Berks County. For complete information on this pool please call Cheryl Fairbairn at 610-696-3500 any time after September 1. Wool must be clean and free from debris.