Wool prices hit by stronger kiwi dollar - 26 March 2009

NZ Wool Services International Ltd reports that prices at today’s wool auctions were hit by a marked increase in the value of the New Zealand dollar. 

Since the previous sale on 12 March, the New Zealand dollar has strengthened considerably against the main wool trading currencies, including by 11 per cent against the United States dollar.

Today’s sale was the largest of the season so far, with a combined 29,641 bales offered in the North and South Island wool auctions in Napier and Christchurch, of which 61 per cent sold. 

According to New Zealand Wool Services International, continued restricted demand held back local market prices. An additional impediment was over-rostered wool volumes, mainly due to brokers who had kept stock back earlier in the season putting it onto the market this week. 

Despite prices being lower in local terms however, in overseas currency most types were firm to 2.5 per cent dearer. 

Exporters struggled to place some types on offer, especially the high volume of poor colour fleece wools and lines with heavy vegetable matter content.

Fine crossbred fleece was 3.5 to 7.5 per cent cheaper, with comparative shear types five to 11 per cent cheaper. 

Good colour crossbred fleece was 2.5 to eight per cent cheaper, with the B/C poorer styles seven to nine per cent cheaper. The only area that resisted the trend was slightly off style fleece, which was one to two per cent dearer.

Coarse second shears and first lambs’ fleece were five to nine per cent cheaper. 

Oddments ranged from four to ten percent easier.

Main buyer activity at today’s sales was from China, India and Australasian carpet mills, with support from the Middle East, UK and Western Europe.

The next New Zealand wool auction, of South Island wool only, will be held on Thursday 2 April, comprising approximately 7,000 bales in Christchurch.

New Zealand Wool Services International publishes a detailed weekly report on New Zealand wool auction trends. A summary of this can be viewed at http://www.nzwsi.co.nz. The full report is available by negotiation with the company.