Friday, March 29, 2024

Strong competition lifts wool prices

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Increased demand and a seasonal shortage of wool has pushed wool prices up at both the latest North and South Island wool auctions.
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PGG Wrightson wool manager Grant Edwards says strong competition on the auction floor and good lifts in prices is nothing but good news as the market begins to find its feet back after the 40% drop immediately post-covid.

A shortage of wool pushed the market to a better level at the Napier sale on Thursday, while a good quality offering of wool in Christchurch resulted in significant lifts and clearance for all wool types.

Bidding was widespread at Christchurch with buyers having to complete orders for prompt shipping for China.

“We are now seeing a lot more interest coming from China so there has been a reasonable amount of wool sold for pre-Christmas shipment,” Edwards said.

“Prices are going up accordingly.”

India has also increased its demand on the buying floor.

“We have stronger demand from India buying in the lower prices, mainly for rugs, and this demand has increased 10%, from the normal 8% to 18%.”

A dominant Australian wool exporting company represented on the Christchurch bench provided the extra urgency in the auction room, especially in the mid-micron and Merino wools.

“Wool is being sold around the world, the European manufacturers have increased volume and that’s a good sign post-covid,” he said.

The challenge now, Edwards says, is around demand and supply.

“We are historically short at this time of the year for crossbred wool, but that will pick up,” he said.

“We are happy to see a lot more positive signs in the marketplace.

“But we have also got to understand that prices have got a long way to go to be at acceptable levels to the growers.”

Good style crossbred fleece lifted 10% at Christchurch, with the tops making $2.35 a kilogram clean, average $2.25/kg and poorer style $2.05/kg.

Crossbred second shear fleece lifted 5%, ranging from $2.00/kg up to $2.25/kg.

Mid-28-micron fleece was up 15% at $6.80/kg, while 23-micron hogget fleece lifted 18% selling at $11.10/kg. 

Merino fleece was better by 12%, with 18-micron types selling at $17.60/kg and 16-micron $21.20/kg.

The Napier sale was up a further 10% on the Christchurch sale with good crossbred fleece selling at $2.55/kg, average $2.30/kg and poorer style $2.24/kg.

Crossbred second-shear fleece was also better with 75-100mm length up 9%, selling from $2.30-$2.35/kg, 50-100mm up 12%, selling from $2.12-$2.22/kg, and good style shorter length, 50-75mm lifted 14% to sell at $2.22/kg.

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