ASI pushes for support of raw wool and pelts
As trade negotiations with China show some signs of progress, American sheep producers are still being hit hard on raw wool and pelt prices. Retaliatory tariffs by China have caused American raw wool exports to drop by 84 percent in volume and 85 percent in value. For pelts, the situation is worse. This once valuable byproduct is now a deficit for sheep producers, who find themselves paying for disposal.
The American Sheep Industry Association included this dramatic market impact in its request that the U.S. Department of Agriculture include assistance for raw wool and pelts through Ag Secretary Sonny Perdue’s Market Facilitation Program. The industry did receive $17 million for lamb meat purchases and an additional $1.5 million in trade promotion for wool and pelts, but no direct payments were authorized.
That said, the industry still has an opportunity to secure meaningful relief for sheep producers through the existing Wool Loan Deficiency Program. This sort of wreck in the wool market is exactly what the wool marketing loan should address. However, the weekly report on wool prices published by USDA does not reflect the weak prices – particularly for ungraded wools – therefore no payments are available. A unique feature ASI added to the wool marketing loan program was a provision to cover unshorn lamb pelts with a loan deficiency payment, so getting this program updated and operational really does fit.
ASI staff and leadership at all levels have been talking to USDA market reporters and price support officials to incorporate current wool market information. ASI representatives have also highlighted the lack of this information in recent testimony to the House and Senate agriculture committees, members of Congress, and the White House. The wool price information is available, has been successfully reported in the past, and the addition of that information to reflect market conditions should trigger LDP to give producers some relief.