Strong New Zealand dollar constrains wool price

News release – Strong New Zealand dollar constrains wool price

New Zealand Wool Services International Ltd reports that price at today’s wool sale were held in check by the rampant New Zealand dollar.

In an offering of 15,392 bales of North and South Island wool, 86 per cent sold, despite strong gains by the currency since the previous auction two weeks ago.

Prices were mixed, with falls slightly outnumbering rises, due largely to the resurgent dollar, which saw the weighted indicator for the main wool trading currencies firming by 2.42 per cent since the last sale on 26 May. Against the United States dollar the difference is even greater, with the New Zealand dollar appreciating by 3.14 per cent against that currency in the same period.

New Zealand Wool Services International general manager John Dawson said that despite this hinderance, there were some price gains in local terms at today’s auction, and removing the currency factor for the types that lost ground generally left those prices approximately on par with the previous sale.

“Mid micron fleece was firm to 2.5 per cent dearer. Fine crossbred fleece and shears were buyers’ favour to two per cent easier. Coarse crossbred fleece prices generally remained firm. Coarse shears were firm to two per cent easier.

“First lambs’ wools were strongly contested as their season draws to a close. Prices lifted between two and six per cent.

“While long oddments rose by two per cent, the shorter types came back between two and six per cent,” he said.

According to John Dawson, competition at today’s auction was good. Buyers from Australasia, Western Europe and China took principal roles, with support coming from the Middle East, India and the United Kingdom.

Next week’s sale on 16 June will offer approximately 3,700 bales from the North Island and 3,800 bales of South Island wool.

New Zealand Wool Services International publishes a detailed weekly report on New Zealand wool auction trends. A summary of this can be viewed at http://www.nzwsi.co.nz. The full report is available by negotiation with the company.

-ENDS-

Note to editor:
The full and detailed version of the New Zealand Wool Services International New Zealand Wool Report is taken by various national and international corporations, exchanges and agencies, including NZX, Reuters, the UK Wool Report, Meat and Wool New Zealand, Australian Wool Exchange and various others including bank economists and analysts.

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