This is after another disappointing Christchurch crossbred auction last Thursday, when about 1500 bales were withdrawn pre-sale and the pass-in rate of the remaining 8000 or so bales was still very high at 29% as farmers resisted selling below their view of value.
Prices fell again, though they are still slightly above the low point earlier in the year, before a temporary but short-lived spike in prices.
Examples of the slide were 34-micron full wool, good-to-average quality, off 47c to $3.90kg/clean, and crossbred second shear 37-micron, 3 to 4 inches, down 25c to $3.61kg/clean.
Asian market demand remains very quiet.
“It’s not a crisis but we’re in unfamiliar territory ‑ there’s more wool being stockpiled than being sold,” Burridge said.
Apart from unsold wool, there is also a lot of product at different stages along the pipeline between grower and consumer, making funding difficult for buyers.
Burridge thinks there could be about 80,000 bales of South Island wool still to sell by the end of the season in June, including 30,000 or so bales unsold from sales over the past four to five months.
“It’s the most in a generation, and unlike the last time it was like this there’s no Wool Board in the background as a rescuer to pick up the pieces.”
The amount to sell is lower than then, but sheep numbers have fallen drastically, so the amount unsold is high relative to total volumes produced.
With just five more sales before the season ends in late June, the prospects are farmers with unsold wool ‑ possibly up to 20,000 bales ‑ going into the new season starting in mid-July, will soon be competing against fresh pre-shear wool, Burridge said.
“It’s a decision to be made, whether they hang on and face that or meet the market.”
Generally, 31 to 34-micron fleece, including hogget wool, was 1-2% cheaper last Thursday than at the previous sale on April 6 ‑ crossbred 35-micron and stronger were 4-5% cheaper, and crossbred second shear 3-4% down.
Lamb’s wool was 5-8% cheaper, with the broad micron most affected. Crossbred oddments were 5-9% cheaper.
Sales (all in clean measure) were:
Full wool, good to average: 32-micron, down 15c at $4.19kg; 33-micron, down 21c at $4.18kg; 34-micron, down 47c at $3.90; 35-micron, down 34c at $3.71; 36-micron, down 35c at $3.69; 37-micron, down 23c at $3.74; 38-micron, down 18c at $3.73; and 39-micron, down 17c at $3.72.
Crossbred second shear: 33-micron, 3-4 inches, off 23c at $3.85kg; 2-3 inches, down 13c at $3.62kg; 35-micron, 3-4 inches, down 19c at $3.69, 2-3 inches, off 19c at $3.47; 37-micron, 3-4 inches, down 25c at $3.61, 2-3 inches, down 22c at $3.42; 39-micron, 3-5 inches, down 28c at $3.60, 3-4 inches, down 27c at $3.57, and 2-3 inches, down 24c at $3.41.
Crossbred first lamb’s wool: 28-micron, down 23c at $4.65kg; 29-micron, down 11c at $4.15kg; 30-micron, down 27c at $3.73; 31-micron, down 20c at $3.40; 32-micron, down 33c at $3.27; and 33-micron, down 20c at $3.42.
