FARMERS in the Falkland Islands told Penguin News this week that with wool prices at a serious low and cost of living up they are struggling to pay mortgages and bills.
At the upcoming April 25 meeting of Legislative Assembly Member of Legislative Assembly Gavin Short will ask MLA Teslyn Barkman to inform the Assembly what the average percentage decrease in wool prices have been since the highs experienced in 2018/2019 and whether there was any emerging evidence of farms starting to encounter liquidity issues.
In advance of that meeting Penguin News approached farmers in the Falklands and asked for their view of the situation.
Speaking from Horseshoe Bay in the north camp on East Falklands Margaret Goss said she and her family were struggling, “as we have no cash flow because of low wool prices and increasing rise in expenditure,”
She said; “We can’t get any help from the bank as we are too old for an overdraft.”
Margaret told Penguin News; “FIG could assist by paying a subsidy to those who have less than ten thousand sheep and who have no other income such as tourism etc. A subsidy could be paid on kilos produced for wool per farm.”
A West Farmer who asked not to be named told Penguin News the last three years had got progressively worse. He said they still had some wool unsold from last year, “this year we have sold all our fleece wool.”
In 2019 their net was £68,000, “which was our best income in all our time farming, then the wool market was very good, wool income has now dropped to £25,000 for the same sized wool clip.”
He said cost of living “is so much higher now, stores, fuel, freight, etc. Wool freight is the biggest killer being roughly a pound a kilo. So times are pretty tough no money for farm infrastructure, improvements and suchlike.”
He thought government could help “especially as they are helping tourism, because wool markets are no fault of our own. But I wouldn’t like to see the dreaded subsidy’s return, help with shearing labour and freight costs would be a big help.”
Speaking from the West Kevin Marsh of Harps Farm told Penguin News: “Since Covid, all farms have seen a decrease in wool prices in the region of 50%. However, in my opinion, the biggest impact on farmers is our outgoings have failed to follow the trend of the wool market.
“Shearing Contractors and shippers have persisted with increasing their rates year on year – meaning direct costs such as shearers, freight charges, fuel costs, fencing materials are close to the pivotal point of making many farms unsustainable.”
In Kevin’s opinion wool could be sold, however, despite sales being slower and prices lower, “prices offered are reasonable compared to world markets, matching or sometimes exceeding AWEX prices. However the volume of wool manufacturers are processing has not recovered since Covid, which results in a much slower market. It’s worth noting, although we are still gaining good market prices in comparison to world markets, it’s a global market that has plummeted in the last four years, over a 50% decrease.”
Asked if he felt FIG should help those farms struggling he said: “Farmers are struggling very much. There is the same feeling of the mid 90s where most young farmers are now looking for second off-farm work (contract works, self-catering, haulage, stevedoring, labouring on other farms) to subsidy their farm incomes. There are very few farmers on the West that do not have a second income. Although wool prices are higher than the mid 90s, any extra has been absorbed in our increasing direct costs; shearing, freight, fuel, materials, Sure.”
In terms of the form that should take Kevin suggested: “Although the farming communities are in the midst of harder times FIG has recently cancelled one of the two financial contributions the Department of Agriculture offers farmers. The former labour scheme run by DoA was removed last year in FIG cut-backs. It would be nice to see that scheme reinstated.
“A scheme such as Europes ‘Red Diesel’ would be advantageous to everyone who works in the agricultural industry, last year Harps fuel costs were in excess of £12,000.”
An East farmer who asked to remain anonymous said the wool prices simply weren’t good enough, “I’m skint and I’ve got a mortgage to pay – I’ve been to FIDC and to MLAs and they won’t do anything about it.”
He said in fact in his meeting with FIDC at one point they suggested he sell his only one other form of income stream.
The farmer said his wool clip only sold for £29,000 last year and he needed to pay £1,400 a month so there wasn’t enough left to run a farm.
He suggested at the very least FIG could help with shearing costs.
Speaking from Saunders Island David Pole-Evans commented that he had sympathy for farmers with under 3000 sheep “we are aware they are struggling all the time… they end up having to go and work elsewhere which puts more strain on families.”
He suggested FIG give a “handout” and not expect it to be paid back or “you would be better off not having it.”
David who sells through WoolGrowers said he had managed to sell his wool at a lower price.
He said: “we are so lucky because we make more money off tourism than we do off wool, we are cutting down on sheep because the island has dried out so much – the price of shearing is going up”
He said: “We’ll be lucky if we have many sheep here in three years time because the freight is getting more expensive to get wool away and sheep to the abattoir – it’s a struggle.”
Justin Knight from Leicester Creek said he studied the weekly market “and where we sit, and knowing other farms approximate average micron, I’m sure that some will be feeling the pinch. Wool prices in general in the early part of the season were in my opinion very poor, the amount of effort that goes into clip preparation so as not to be discounted on too much isn’t cheap.”
Justin said Leicester wool had been sold and “prices were OK, but it’s the best we had been offered all summer and with the moving of warehouses we took the decision to sell.”
He added that they had taken on extra work to balance poorer sales.
Justin commented that farmers, like every other industry were at the mercy of global markets adding, “I’m not sure what FIG can do to help, in some cases a lot

have taken on extra work/jobs. “With reading the current extract of FIDC’s board meeting, I’d love to know why DOA didn’t supply the requested information to continue with supporting of the Responsible Wool Standard (RWS). This for some would be a start, continuing with Farm Improvement Plan (FIP) could be another.”
He said he didn’t believe mortgage freezes were a healthy option for the farmer.
A farmer who wished to remain anonymous said “I know farmers are feeling the pinch. We haven’t sold any [wool] yet from this season. Generally we would pre-sell but due to prices this year we have held back that may bite us in the butt.”
He added: “I know that some farmers are struggling out there. We are fortunate to have put some money aside over the years however we are now using that. It is difficult to say what assistance folk would need as everyone is different, some have secondary incomes etc. Our income, should we sell now, will possibly drop by 40%. Freight has gone from £5,500 three years ago to £11,000 last year.”
He also noted that: “Also the mortgages and commodity prices have risen expediently but of course this affects you guys in town as well. Abattoir prices PPL fell. FIGAS prices are up, internal sea freight is up. Again we are fortunate that we have large gardens so for the basics we are self sufficient.”
Nick Pitaluga from Salvador Farm but also representing the Rural Business Association commented: “We are normally a year ahead with wool sales funds in bank against working funds account, but this year has seen us eat into some of that reserve a good seven or eight months ahead of when we might normally expect to.”
He said wool sales were dismal “there is no other way to say it. Some wool has been sold by our agent for reasonable prices given the market climate and these sales are very much a hand-to-mouth situation with buyers who are only contracting a lot purchase when they have an onward contract to fulfil.”
He said it was actually a more stagnant market than back in the 80’s/90’s when the Aussie stockpile was depressing the world market prices.
He explained: “Wool would always sell then, just not at prices that could enable a living, plus costs for new farmers in particular. Hence the various assistance programmes that abounded plus direct subsidy payments to keep people on their farms.”
He said his greatest concern was for any of the younger/new farmer families with some fairly large acreages to run, “who also have massive debt servicing levels to meet.”
Regarding assistance he said what those levels might or could look like “and with rural future at the core of it, is very much going to be the focus of this years Farmers Week programme”.