The Australian Wool Exchange recorded a $0.7 million deficit during the last financial year, drawing from its reserves to meet its costs. According to latest AWEX annual report, revenue for the year was $6 million, including $2.7 million in bale label sales. The deficit came after three consecutive years of operating surpluses, including a $0.4 million surplus in the financial year ending June 2022. In his report, AWEX chair Andreas Clark said the board approved a strategic drawdown on reserves during the year to support a range of key initiatives. "We were in a position to do this due to the steady and planned accumulation of reserves over the past few years," he said. "As at 30 June 2023, cash and other financial assets remained a healthy $9.4mil, in line with our reserves policy which has been set to ensure there are sufficient funds to meet all our outstanding liabilities at any point in time, and a minimum level of coverage of forecast operating cash flows. "Our reliance on a narrow set of revenue streams continues to be a key business risk and planning is underway to address this." The year saw 1.63 million bales, or 287.3 million kilograms, sold at auction making $2.42 billion. The Eastern Market Indicator averaged out at 1301c Of the wool sold, 78 per cent was declared using the National Wool Declaration. Out of the bales declared, 19.8pc were non mulesed and 3.2pc were ceased mulesed, while 41.2pc were mulesed with an anaesthetic or analgesic product. China remained the top export destination with an 80.6pc market share, followed by India with a 6.3pc share and Italy at 4pc. Of the wool exported to China, bales a 19 or finer micron had a 84.4pc market share. Uptake of the WoolClip digital platform surged, increasing by 81.8pc to 159,279 bales, a roughly 8.6pc share of estimated wool production The figure surpassed AWEX's target of 125,000 bales, with uptake continuing to accelerate into the 2023/24 season with a 120pc increase in the first quarter compared to the year prior. "WoolClip is a strategic asset and a key platform in wool traceability and the significant investment in supporting ongoing extension activities has been critical in delivering this result," Mr Clark said. "Ongoing and effective collaboration with key industry partners continued to strengthen during the year which further supported the growth of WoolClip as the preferred on-farm platform for the industry."