Wool prices hard to pre­dict

South Waikato News - - RURAL DELIVERY -

Amuch im­proved wool mar­ket is com­ing into po­si­tion in the next few months and will re­veal if prices will hold.

Wool ex­perts are find­ing it dif­fi­cult to pre­dict the car­pet wool mar­ket’s next move­ment be­cause of op­pos­ing ten­sions be­tween tighter sup­plies and bet­ter prices on one side, and Europe’s fi­nan­cial trou­bles and more wool en­ter­ing from sum­mer shear­ing. Av­er­age wool prices have re­mained above a clean price of $6.50 a kilo­gram ($5.20 a kg greasy) for the last five months, af­ter ris­ing steeply from $4 a kg clean in Septem­ber last year.

Wool Part­ners In­ter­na­tional mar­ket­ing ex­ec­u­tive Mal­colm Ching said the mar­ket’s po­si­tion hinged on what would hap­pen with fi­nan­cial mar­kets off­shore, par­tic­u­larly in the euro zone with con­fi­dence start­ing to wa­ver. The mar­ket might be­come more volatile in the next few months and fol­low a zig-zag pat­tern but could im­prove again, as there was not much wool around, he said. ‘‘There are as many pos­i­tive as neg­a­tive fac­tors. Un­for­tu­nately, we don’t know how it will go un­til it hap­pens.’’

Cross­bred wool prices for the car­pet wool sec­tor are at a clean level of $6.45 a kg to $6.80 a kg for all lengths and most mi­crons.

Per­haps off­set­ting the in­flu­ence of Europe’s credit cri­sis will be the short­age of wool in­ter­na­tion­ally, with some com­pa­nies ex­pect­ing less wool this sea­son be­cause of com­pe­ti­tion from other agri­cul­tural ac­tiv­i­ties, chiefly dairy­ing. Clear­ance rates have been low at the Christchurch wool sale in the last month, with much of the wool passed in be­ing traded soon af­ter­wards.

Busi­ness­day.co.nz

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