Farmers unions across the UK have urged their retrospective governments to intervene after British Wool was refused access to a UK Government fund to help businesses hit by the coronavirus pandemic.
British Wool was left with around 10 million kilos - a third of its 2019 wool stock - unsold after wool markets closed because of Covid-19. As a result, prices averaged just 32p/kg for last year's clip.
The busiest selling period for wool from the UK is between February and May each year.
Despite funding being made available to other wool purchasers, British Wool was refused the funding through the Coronavirus Business Interruption Loan Scheme (CIBLs) because it is seen as an 'arms-length' government body.
The organisation receives no government funding but is protected by the 1950 British Wool Act and has two independent government-appointed members on its board.
The Farmers’ Union of Wales said it had written to Welsh Economy Minister, Ken Skates, to press the issue.
In its letter, the FUW highlighted the impact that the closure of wool markets would have on the price received by sheep farmers for their wool and highlighted that sheep producers must still pay for this year's shearing costs.
FUW deputy president Ian Rickman said: “The closure of normal wool markets has left British Wool with around one-third of its woolstock unsold and this has had a direct impact on sheep producer incomes.
This unsold stock not only detrimentally affects calculated wool values, which are payable for the 2019-20 balance, but also means that British Wool are unable to pay an advance for this season’s wool.
“British Wool is wholly independent, self-funding and operates within a competitive market place. We believe that British Wool should have fully qualified for support under the CBILs scheme or some other variation of covid-19 support for businesses.
“Given the impact upon both the sector and upon primary producers, we have made our views known and have written to the minister to call for a rethink on this funding decision,” added Ian Rickman.
Ulster Farmers' Union Hill Farming Committee chairman Nigel McLaughlin, said the union had also called for the Northern Ireland Executive to step in. British Wool operates under the 'Ulster Wool' brand in Northern Ireland.
“The wool sector remains in turmoil due to trade disruptions caused by the pandemic. We wrote to Minister Poots in late May about the grim conditions of the global wool market which are a direct result of Covid-19 and have also been working closely with Ulster Wool and British Wool. We would now like to see steps being taken to address the market conditions," McLaughlin said.
“The implications of the wool market combined with the fall of farmgate prices have resulted in sheep producers across the country struggling to get by as all their revenue streams have taken a financial hit.
“It is likely that the challenges created by Covid-19 will linger for the next 12-18 months stressing the need for financial intervention to address the global wool market crisis.
"The entire sheep industry benefits from Ulster Wool being successful and we would ask that the minister considers this as part of his Covid-19 support package for the sheep sector.”
A spokesman for British Wool said the body was grateful for the time union officials took to listen to the issues sheep farmers are facing due to the effective shutdown of the wool market.
The spokesman added that he hoped to hear back from the Welsh Government shortly.