Weak rand pushes wool market to fresh seasonal high

06 Mar '08

2 min read

The weaker rand supported the market at this week's sale and Cape Wools' Merino indicator gained 2.6% to close at a fresh seasonal high of R69.95/kg (clean).

This means that the indicator currently is 25% higher than the opening sale and up 34% on the same sale last season. The Australian indicator was 0.3% up on last Wednesday.

The rand has been on a roller coaster ride over the past week and at one stage tested the R8-the-US-dollar level before recouping some of its losses. At today's sale, it was trading at around R7.80, which was down 4.5% on last week. It had also lost ground to the euro, trading down 5,6% at R11,85.

Fine wools (19 microns) benefited the most, gaining around 5%, while the other Merino long wool categories were up between 2% to 3%.

It was a fairly large offering, totaling 11 225 bales of which 97% were sold. Major buyers were Standard Wool SA (3 196 bales); Modiano (2 530 bales); Chargeurs Wool (1 790 bales); and Lempriere (Aust) Ltd (1 067 bales).

Average price movements for AWEX-type fleeces, MF4 and MF5 of 70 and 80 mm were as follows: 19 microns gained 5.1% at R88,07/kg; 20 microns rose 1.6% to R77,35/kg; 21 microns were 3,3% dearer at R71.18/kg; 22 microns were up 2.3% at R69,76/kg; and 23 microns rose 2.6% to R67.14/kg. There were no quotes for 24 and 25 microns in these specific categories.

Approximately 12 000 bales will be offered at next week's sale.

Cape Wools SA

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