Clearance rates remain low at weekly wool auctions

Friday 2nd June 2017

New Zealand's wool market remained weak at the latest South Island auction as tepid off-shore interest and the stronger New Zealand dollar weighed on clearance.

Of the 8,065 bales offered 65 percent cleared, back further on the season to date clearance rate of 75 percent and well down on last year’s 89 percent clearance rate, AgriHQ said.

Prices fell further across the board compared to the last South Island sale two weeks ago. Coarse 39 micron crossbred wool fell 25 cents/kg to $3.50/kg. Similarly 37 micron crossbred second shear wool fell 40 cents to $3.35/kg, AgriHQ said.

Though 30 micron lamb wool fell to $3.70/kg compared to two weeks ago, prices firmed compared to last week’s North Island sale, up 15 cents, it added. It noted, however, the trend was not the same across the board with most prices remaining firm or easing over the week. AgriHQ said 29 micron lamb wool fell 10 cents/kg to $4.10/kg and 37 micron crossbred wool fell 25cents/kg to $2.85/kg.

Coarse crossbred wool indicator eased 5 cents to $3.65/kg. Meanwhile the lamb indicator rose 6 cents to $4.17/kg.

New Zealand is the world's largest exporter of crossbred wool and weak demand for the fibre, which makes up about 80 percent of the national clip, has weighed on prices this season. The Ministry for Primary Industries noted in its latest quarterly outlook that wool export prices may remain subdued until inventory is worked through and demand from China returns.

Next week's North Island sale is expected to have 8.500 bales on offer.

(BusinessDesk)

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