25 Jan 2010

Exchange rate main influence on opening wool sales

11:22 am on 25 January 2010

The exchange rate has been the main influence on prices at the opening wool sales of the new year.

A stronger New Zealand dollar, along with a seasonal increase in supply weakened prices in domestic currency terms for most of the wool on offer at the first auction of the year.

But returns lifted again at last week's North Island sale as the dollar slipped again against the main wool trading currencies.

New Zealand Wool Services International reports that the currency adjustment brought a significant lift in prices for some wool types.

First lambs fleece prices shot up by 8% - 9%, as exporters struggled to meet demand from Chinese manufacturers.

Prices rose by up to 7% for some lines of cross bred fleece and coarse carpet fleece and shears ranged from 1.5% - 3% dearer.

There was strong competition for the almost 10,000 bales on offer, and 94% were sold. The sale was the third to date this year.

A further 25,000 bales will be auctioned at this week's combined North and South Island sales.