Wool drop forecast

Press, 30 December 1988, Page 9

Wool drop forecast

Wool production in New Zealand is likely to decline slightly during the next few years, believes the Wool Board. The board’s chairman, Mr Pat Morrison, said the size of the clip could diminish one to two per cent a year, although the size of the fine wool segment would either be maintained or increased. This trend was likely until the production of lambs for meat became economic for farmers. The board did not expect the wool clip to increase for several years. Although the international demand for wool was likely to remain steady in 1989, New Zealand growers would face a difficult year because of problems such as drought, low prices for sheepmeats, high interest

rates and artificially high exchange rates. Heavy reductions in stocks in Canterbury and North Otago and a decline in wool weights because of the drought could mean a decline in the quantity and type of wool traditionally available in the early months of the year, said Mr Morrison. Assuming the drought broke, the rebuilding of capital stock by the end of 1989 will reduce the lamb kill and result in a further fall in a slipe wool production. This could be aggravated by a rise in live sheep exports. The board expects China will remain New Zealand's biggest market in the immediate future, although the strong demand seen this year would probably not be maintained.