Thursday, November 30, 2023

End-of-season wool sales disappoint

Avatar photo
Prices not helped by glut of bales and no room at the scour.
Reading Time: 3 minutes

Wool prices were all over the place at the end-of-season sales in both the North and the South Island.

Wool auctions were held in both islands on June 29 with a massive total of just under 24,000 bales offered across the two sales. 

Considering that most exporters have a June 30 end of financial year, along with the North and South Island wool scours being booked out until at least October, the market was always going to waiver with this volume of wool being offered on one day, DevoldNZ wool manager Craig Smith said. 

It seems like the wool brokers were desperate to get wool sold due to their year-end as well.

“Not the smartest decision to load up the last week with such a high volume,” Smith said.

As predicted, only 72% of the offering was sold – 17,000 bales.

PGG Wrightson South Island wool manager Rob Cochrane reported a large South Island offering for the final 2022-2023 sale including some “superb” Otago Perendale types, which drew support from buyers.  

The super long, white, pre-lamb fleece was very sought after on a very limited offering that saw this wool take an increase of 3%, pushing the top price for good style crossbred fleece to $3.90/kg. Average colour fleece on a small offering remained at the same level, $3.10, as the previous South Island level, while poor coloured fleece was 2-3% cheaper at $2.50.

Super white second shear 50-100mm was also very sought after, up 3% and fetching $3.60 on any wool that had supporting test figures on brightness and high yields.

Wool that was slightly off colour or showed poor preparation was discounted heavily off the super nice wool.

In the North Island sale, across the board all types were discounted from the South Island levels by 30-50c less. 

“There was a real correction. Apart from a handful of good fleece lines the market trend was down across the board. Bidding was erratic over some lots and very subdued with others,” PGG Wrightson North Island auctioneer Steve Fussell said.  

The North Island offering comprised 60% crossbred second shear wools that saw price levels back 3-4% on the last North Island and the tandem South Island sale.

Good style crossbred fleece topped at $3.00 with average and poor style down to $2.70 and $2.27. Second shear ranging in style and length made $2.45-$2.82.  

Poor coloured lambs were totally neglected, struggling to get over the $1.00/ greasy kg gross.

Oddment, bellies and pieces were also neglected, selling between 20-50c/gsy kg gross. 

“By the time you have transported these bales to auction, there would be zero income.”

Industry commentators attribute the dive in prices to the only two available scours at Clyde, Hawke’s Bay and Washdyke in the South Island being totally booked out until the third quarter of this year as well as the costs associated with storage, financing and trucking to the South Island to meet shipping and contractual deadlines.

Woolworks’ Awatoto scour in Napier is still out of action following extensive flood damage from Cyclone Gabrielle. 

Quality and colour, given the climatic conditions have also been a huge factor, especially in the North Island.

Word has it that Woolworks is confident of having its Awatoto scour back up and running by November.

“Hopefully this will relieve any of the backlog pretty promptly,” Smith said.

On the finer wool front he said Devold New Zealand has ended the season 20% back, but in line with budget following last year’s exceptional season.

“And in all this, it is not only NZ having the ups and downs in the wool markets, but also a global issue as clients are cautious with money, quite frankly more worried about putting food on the table than wool on their back or carpets on their floors.”

People are also reading