Strong rand forces wool market down

16 Sep '10

2 min read

The wool market declined sharply at this week's sale as a very strong rand exerted downward pressure on prices and Cape Wools Merino indicator shed 4.1% to close at R54,53/kg (clean). The rand this week appreciated to its strongest levels since January

2008 against the US dollar and was trading at R7,03, which was up 2.5% on last week's exchange rate. At R9,14, it was up 0.5% against the euro. The market was put under further pressure by a decline in Australian prices.

The Australian market indicator was down 1.3% compared with last Wednesday's level. The offering comprised 5 218 bales, of which 96% was sold. Major buyers were Modiano SA (2 040 bales); Standard Wool SA (851 bales); Stucken (681 bales), and Lempriere SA (651 bales).

Average prices for good top-making (MF5), sound, long fleeces (less than 1% seed content) were as follows: 19 microns declined by 2.2% to R66,54/kg; 19,5 microns were down 2.2% to R60,86/kg; 20 microns were 5.7% cheaper at R55,87/kg; 20,5 microns declined by 5.3% to R55,62/kg; 21 microns softened by 4.6% to R55,67/kg; 21,5 microns were down 5.1% to R54,96/kg and 22 microns declined by 6% to close at R54,31/kg.

Approximately 7 000 bales will be offered at next week's sale.

Cape Wools Market

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