Friday, March 29, 2024

Wool prices are still falling

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Wool prices fell sharply again, dampening the spectacle of the third annual live auction at the Agricultural Show in Christchurch on Thursday. The crossbred market heads towards Christmas with a lot of concern about the international wool textile sector after earlier price falls in the North Island, PGG Wrightson’s South Island sales manager Dave Burridge said.
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CP Wool auctioneer Roger Fuller didn’t want to sound too pessimistic but said the trend is quite concerning.

“Prices are extremely disappointing for farmers.”

Fine wools and mid-micron wools extended their losses from the previous Christchurch sale three weeks earlier but at least those prices remain at historically very good levels and Merino wool was firm on the Australian sale a day earlier.

Full fleece crossbred wool (31 to 35 micron) was up to 5% lower and stronger wools were up to 9% lower with crossbred second-shear 4% to 7% cheaper.

Mid-micron (25 to 30) were 3% to 6% cheaper with the most stylish lines most affected.

Merino wools were 4% to 6% down with the under 17.5 micron levels most affected. That was the final sale of the season of significant fine wool volumes, Burridge said, and most Merino wool went through the market earlier to achieve the peak prices. Most of the fine wool now is mainly hogget and some wether fleece.  

Fuller estimated up to 70% of the Merino fleece had the benefit of the higher prices but even the current levels remain very good.

A total of 8400 bales was offered with a high pass-in rate of 22%, crossbred wool dominating both numbers. 

Despite the price falls about $8m of wool was sold over the four-hour programme with the live auction giving the public gallery a good display of how the market works.

The outlook for Merino and mid-micron wools remains good, Burridge said. 

Since prices began their upward path about three years ago the indications have been market growth is demand driven, rather than speculative. 

“The evidence is that world production is below demand levels.”

The story for crossbred wool is different, with fashion changes in the crucial Chinese market leading to limited demand and very little new business being written.

A worry is that prices are as low as they are with the bulk of North Island wool starting to come to the market in the three to four weeks, he said. 

Christchurch sale details from PGG Wrightson (all in micron number, price per kg/clean): Full wool (good to average colour) 25 micron, $12.73, down 47c; 26, $10.60, down 30c; 27, $9.89, down 60c; 28, $8.25, down 22c; 29, $7.82, down 40c; 30, $7.35, down 25c; 31, $4.50, down 10c; 32, $4.30, down 50c; 33, $3.66, down 44c, 34, $3.15, down 56c; 35, $2.97, down 44c; 36, $3, down 40c; 37, $2.95, down 40c; 38, $2.98, down 40c; 39, $2.98, down 40c.

Crossbred second shear: 33 micron, 3-to-4 inches, $3.35, down 43c; 2-to-3 inches, $3.20, down 11c; 35, 3-to-4 inches, $2.97, down 30c; 2-to-3 inches, $2.97, down 26c; 37, 3-to-4 inches, $2.95, down 42c; 2-to-3 inches, $3, down 26c; 39, 3-to-5 inches, $2.95, down 42c; 3-to-4 inches, $2.95, down 38c; 2-to-3 inches, $3, down 26c. 

Merino fleece, best/good topmaking: 16 micron, $27.20, down $3.30; 17, $26.50, down $3.15; 18, $24.30, down $2.72; 19, $24.20, down 60c; 20, $23.00, down 40c; 21, $21.30, down $1.46; 22, $20.32, down $1.30.

CP WOOL sales included: Benmore Graziers, 37.6 micron, Perendale, $3.03; Orari Gorge, 38.9 micron, second shear, $2.93; Berryman, crossbred hogget, 31.2 micron, $3.95; Willesden Farms, crossbred,  32.7 micron, $3.48; F and A Munro, crossbred hogget, 32.5 micron, $3.65; G and R Wilson, Corriedale hogget, 25.8 micron, $10.62; Longslip Station, Merino hogget, 16.9 micron, $26.16; Longslip, Merino hogget, 17.6 micron, $25.27; Longslip, Merino, 16.9 micron, $27.93; Mt Campbell Station, Merino hogget, 16.8 micron, $27.54; Barcaldine Partnership, Merino, 16  micron, $25.74.

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