Wool auction prices 'still too high’

Press, 14 September 1987, Page 2

Wool auction prices 'still too high’

PA Wellington Wool exporters say sales can be made about present market levels if overseas customers can be convinced the market has stabilised. The New Zealand Council of Wool Exporters’ weekly wool market preview says the present level on good crossbred fleece wools should be sustained, but for fine wools New Zealand auction prices are still too high in relation to Australian values, which in some cases are up to a dollar a kilogram cheaper. The council recently strongly criticised the level the Wool Board was intervening and taking close to half the offering.

In the two Christchurch sales, the board revised its intervention level, and although it was still bidding on a sizeable propor-

tion of the offering, the amount of wool being passed to the Board was more tolerable.

The council’s president, Ms Xavier Droolers, said that while almost all trade buying at present was to satisfy longstanding orders, there was a little new business being written.

However, this was nowhere near the amount normally expected at this time of the season. “What we have to do is convince our customers the present level of prices win be sustained and encourage them to take up some of our forward offers,” she said. “In that way the main supply of wool on to the market in about six weeks can be faced with some confidence.”

The season opened in New Zealand dollar terms

with a market indicator of 580 c (dean), but the overheating that had developed since then had done no good to the market

The Wool Board’s strong intervention had cushioned the grower from one price level to another, but to potential buyers overseas it was seen as an aggressive stance.

Japanese inquiry was significantly below the present market for fine wools and for Halfbred and Corriedale wools the market would probably settle a little further.

Chinese buying was almost non-existent although there were one or two small sales that had been made of special types. Sales to the Soviet Union by exporters were also limited.