Drop in dollar

16 August 2007

Drop in dollar, reduced volumes spell farmer gains at wool auction

New Zealand Wool Services International Ltd reports that today´s wool auction held in Christchurch was dramatically affected by the recent decline of the New Zealand dollar, down eight per cent against the US dollar since the previous auction last week.

In addition to the currency situation, wool volumes rostered for sale since June are down by 34 per cent, with further coarse wool supply restrictions expected in the coming months. Coupled with the falling dollar, reduced volumes mean significant gains for farmers from today´s auction.

At today´s sale, mid micron wools, in the 25 to 31.5 micron range, generally increased seven to eight per cent (55 NZC/KG clean on floor), with fine and coarse crossbred wools of all descriptions gaining by 10 per cent (35 NZC/KG clean on floor).

New Zealand Wool Services International reports that the only types not fully benefiting from the current market gains were the wools 36 micron and coarser, containing high vegetable matter, which are being discounted by 20 to 30 NZC/KG clean on the floor.

The top four wool exporting companies active this week were New Zealand Wool Services International buying 36 per cent of the offering, Furhmann 12 per cent, Masurel 11 per cent and WG Robinson 9.5 per cent.

Next week´s combined North and South Island wool auction, on 23 August, comprises 18,700 bales.

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-

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