HOOF

The percentage of the wool contribution to the value of exports had dropped from 26% to 1.6% from 1920 to 2011. The importance of wool was reduced as the people started to use synthetics and also due to the end of government subsidies in 1984 (Federated Farmers, 2002). Because of these factors sheep farmers have started to show more interest on sheep meat production and dairy farming as they have relative better export values (wool export value reduce by 60% whereas the meat exports value rose about 189% from 1989 to 2011 ).

During the Korean War (1951), although the general price inflation was relatively high, there was sharp rise of wool export prices (130%) and there was a huge increase in demand. This increase in prices led to wool boom. These prices did not remain the same for long time, the price trend started to decline (53%) till 1970. Again there is sharp rise of price (more than 800%) in between 1971 and 1989 i.e. wool export prices relative to total export prices rose by 33%. (Statistics New Zealand, n.d)

There is a continuous decline in wool prices from 1990 due to the dissolution of the former Soviet Union. This resulted in a huge impact on wool prices as this union is one of the world’s major consumers of wool (Australian Bureau of Agricultural and Resource Economics, 2000). Also, introducing synthetic products into the market affected the wool industry. The characteristics and low prices of synthetic fibres have led to increase in their demand and suppressed the growth of the wool industry. About 50% of wool exports have dropped because of all these factors. Overall, there is a drop of 42% of wool exports relative to total wool exports in between 1954 till now. (Statistics New Zealand, n.d)