Wool market at highest level ever

03 Feb '11

2 min read

The wool market put up another strong performance at this week's sale when the Cape Wools Merino indicator rose 2.8% to close at R80.29/kg (clean), its highest level ever. This is up 38% on the opening sale and 30% higher than at the same sale last season.

In Australia, where the weekly offerings are smaller than usual due to delays in shearing and the transport of wool from certain areas as a result of rain, the market indicator rose by 3.2%.

Increased global demand for wool and an expected further decline in Merino wool production this season currently are the main reasons for the price increases.

The rand, at R7.06, was relatively unchanged against the US dollar compared with last week's rates, while it was 1.6% weaker against the euro at R9.77.

This week saw another small offering with only 6 525 bales on offer of which 96% was sold. The selection of long, quality fleeces were limited, which meant that quality wools fetched excellent prices.

Major buyers were Standard Wool SA (3 132 bales), Modiano SA (1 367 bales), and Stucken (845 bales).

Average prices for good top-making (MF5), sound, long fleeces (less than 1% seed content) were as follows: 20 microns were 4.1% dearer at R84.87/kg; 20.5 microns rose 2.5% to R81.13/kg; 21 microns strengthened by 3.1% to R78.37/kg, and 21.5 microns were up 3.9% at R78.16/kg.

Approximately 6 500 bales will come under the hammer at next week's sale.

Cape Wools SA

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