Wool demand in India ticks up after tariffs removed

A delegation of Australian wool industry representatives travelled to India to discuss how to build the trade relationship following the ratification of the free trade agreement between Australia and India late last year.

The agreement included the removal of wool tariffs as of December 29.

The March delegation included representatives from from bodies including WoolProducers Australia, the Australian Council of Wool Exporters and Processors, the Australian Wool Testing Authority, Australian Wool Innovation and the Department of Foreign Affairs and Trade.

Data from the Australia Wool Industries Secretariat shows that during the July 2022 to January 2023 period, India took a 6.4 per cent share of Australia's wool, up from 5pc for the same period a year before.

WoolProducers Australia CEO Jo Hall said the increase couldn't be put down to the removal of tariffs, with India more active through last year as they started to take more wool again following COVID-19 related mill closures.

But Ms Hall said the figures were promising and they expected the removal of tariffs to further boost the amount of Australian wool going into India.

"India is currently buying about 6pc of our clip... obviously we'd like them to be buying more of our wool, so this is the start of relationship building between our production sector and our processing sector," she said.

"The trip was hosted by the Ministry of Textiles in India and was very positive.

"We discussed a number of things including access to labour and what we're aiming to do is build those cooperative relationships that are mutually beneficial to both sides."

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Ms Hall said the removal of tariffs from Australian greasy wool should provide certainty to both importers and exporters.

"India are the second largest single country importer of Australia so they have been in our markets for quite a while and we would like to see that increase going forward," she said.

"There is a really high-end market in India... if we could break into that market, it would be very beneficial."

The trip also included the opportunity for the delegation to attend the three-day long India Fashion Tex hosted by the Indian Wool and Woollens Export Promotion Council and meet manufacturers.

Along with Vietnam, Bangladesh and Indonesia, India was identified as a priority market in a Deloitte Access Economics report into domestic processing opportunities last year.

The report, overseen by WoolProducers Australia, noted that between 2025 and 2050, India's textile industry is projected to grow at between 2.4 (low scenario) and 3.6pc per year and that there were likely to be significant opportunities for Australian wool.