THE wool market has dropped to the lowest levels in eight years in a show of defiance from Chinese buyers.
The Eastern Market Indicator lost ground overnight to settle at a low of 945 cents per kilogram, and despite the great seasonal conditions growers in the Riverina say it's hard to be optimistic right now.
With the market now back at 2012 levels the gloss has gone from the highs experienced during wool auctions last year.
Wool growing specialist, Paul Cocking "Kaloona," at Mangoplah in southern NSW said the sad fact, and unfortunate truth was our strong and almost exclusive reliance on the Chinese market.
He said there were opportunities to head down the road of market diversification in the past but they weren't taken.
Now growers are paying the ultimate price.
With a passion for Merino sheep and beautiful fleece Mr Cocking said he was reading the market signals and had already started diversifying.
In fact, his Mangoplah property has more winter crop this year to try and buffer the impacts of a volatile wool market.
He said there was a large amount of processed fabric being sold into already depressed market conditions.
"It is not surprising ... and the relationship with China is not surprising either," he said.
However, Mr Cocking said there was still money to be made in wool.
"There could be opportunities in purchasing wethers or from getting some younger sheep," he said.
"Overall the livestock industry is in good shape," he said.
"We have had a good season, and we still have a good season ahead of us, we need to remember that sheep and wool still stacks up well against other agricultural enterprises," he said.
From the auctions, more than 33,000 bales were offered at Melbourne, Sydney and Fremantle and 25.7 per cent were passed in.
Wool growers are also weighing market conditions before the fleece even leaves the farm gate with many opting to hold onto it in the hope of better times.
It was the micron levels of 17 and 17.5 which felt the huge brunt of the market fluctuation with as much as 48 cents shaved off the price compared to the previous week.