24 Jul 2013

Drought impact will hit wool farmers' returns

9:17 am on 24 July 2013

Wool exporters are expecting a reasonably positive selling season but say the effects of the summer drought will hit farmers' returns.

New Zealand Wool Services International marketing manager Malcolm Ching says the impact of the drought will show up in two ways - fewer fleeces and some of it of poorer quality.

"One thing will be lower stock numbers," Mr Ching says, "which translate through to lower amount of wool, but of the animals that are still there that have been drought affected, they tend to produce lower fleece weight as well, so that will impact.

"We also have the ongoing conversion to dairy, particularly in the South Island. We're predicting there'll be another drop in stock numbers.

"The other thing ... with drought quite often comes a flush in spring where you have a lot of seed and vegetable matter or during the drought animals are pushed into scrubbier areas and have picked up more vegetable matter in their wool," says Mr Ching.

Fleeces with high vegetable content are worth less.

New Zealand Wool Services International is the country's biggest wool exporter.