7 Aug 2015

Wool prices on the increase

1:16 pm on 7 August 2015

In contrast to free-falling dairy prices, wool prices are continuing to gain ground, helped by a weaker New Zealand dollar and a shortage of supply.

At yesterday's South Island wool sale, nearly all of the small offering of 5,500 bales were sold, with finer wools showing the greatest gains.

Mid-micron wool sold for up to five percent more than last week and fine cross-bred fleece fetched three to seven percent more.

General manager of New Zealand Wool Services International John Dawson said prices were five to seven percent ahead of where they were a year ago.

"Obviously the currency's had a big influence as far as pushing the NZ cent price up a little, and you've seen that with the indicators actually rising, but also there's been a supply factor as well.

"There's tight supplies on the market, this is a traditional thing, there's usually very tight supplies through July, August, September and even into October, so one would expect that the market will remain around these levels for a wee time yet."

He said the main demand had been coming from the biggest wool market, China, though it was not buying as heavily at the moment as it will be later in the season.

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