Two June wool sales with varying results

Press, 12 July 1985, Page 24

Two June wool sales with varying results

With only two sales in the closing month of the season, the New Zealand wool market in June was dictated by the availability of supplies of wool for auction, the Wool Board has said in its market review. Widespread competition created a buoyant market demand for the less-than-rostered quantities and the first sale in June reached a record high market indicator of 520 cents a kg clean (387 c greasy). In contrast, the second sale of the month and the last of the season was dominated by an unexpected surge in new clip wool offered for auction, particularly in the North Island. For the first time in many months, total rostered quantities were exceeded. This bearish influence, coupled with a . significant strengthening of the New Zealand dollar, pushed down on auction prices resulting in an easing in the market indicator of 13c clean (9c greasy) to close the season at 507 c a kg clean (378 greasy). While prices at the clos-

ing sale on June 27 were on par to fully 2.5 per cent lower, the more than 5 per cent increase in the value of the New Zealadn dollar against major trading parnters reversed the price effect on principal overseas purchasers — lifting their purchase costs by up to 2.5 per cent. As a result, end of season wool prices in New Zealand currency terms continued to command substantial price premiums over similar wools available at other interational markets.

There were 62,300 bales of new clip wool offered during June, 6700 bales down on rostered quantities. Favourable growing conditions noticeably lifted the standard and length of the “autumn shorn” bodywools and oddments which constituted 90 per cent of the June 13 North Island sale. The two-island last sale of the month offered a more comprehensive range of wool types with diametrically opposed offerings in each selling centre. While North Island offerings were similar to earlier in the

month, the South Island catalogue consisted largely of combing length wools, including good quality prelamb shorn halfbred and crossbred fleece. The market indicator rose 2c clean to its peak for the season (520 c a kg clean, 387 c greasy) early in the month. Medium/strong crossbred fleece wools firmed slightly in price and short length second shear wools were in sellers’ favour. Clothing oddments recorded the largest gain of up to 2.5 per cent.

The continued availability of short wools finally led to a correction of their price imbalance later in the month with second shear prices declining 2.5 per cent and clothing oddments by up to fully 5 per cent. Slightly cheaper fine wool fleece, crutchings and oddment prices further contributed to the fall of the market indicator to 507 c clean (378 c greasy) at the season’s end.

Against this trend, prices for best style 35 micron and coarser fleece firmed towards the end of the month.