China becoming world leader in wool processing
During the first seven months of this year China purchased 202.000 tons of wool, equivalent to 1.13 billion US dollars, up 61% over the same period a year ago according to the Uruguayan Wool Secretariat.
Last July 31, Chinese companies had completed 59% of their greasy and clean wool import quotas, and had only made use of 15% of industrialized wool quotas. Government managed companies were responsible for the import of 86.000 tons while foreign companies operating in China, 64.000 tons. Market analysts say that supply shortage (Australia's drought), growing consumer demand in China plus the fact the country is becoming one of the world's leading fiber processors have influenced prices. Many wool processing plants are moving to Southeast Asia taking advantage of lower labor costs and less stringent environment regulations. China already processes over 400.000 tons of wool per year which is equivalent to a third of the world's clip.