Wool prices rose on the back of solid demand from all sectors of the trade and Cape Wools’ indicator gained 1,8% to close at R40,63/kg (clean). The rand was slightly stronger compared with the previous sale two weeks ago at R7,01 to the US dollar and R9,52 against the euro. “All long Merino fleece wools were dearer, with most micron categories posting increases of 1% to 2%. Receipts into wool brokers’ stores and direct purchases by buyers suggest that the 2006/07 season may show a small increase in production. Deliveries up to the end of March are up by 2,7% reflecting, amongst others, the good grazing conditions of the first half of the season,” said Ona Viljoen of Cape Wools. Ken Craig of BKB said the market indicator is now 76% higher than a year ago, while over the same period the rand has depreciated by 17% against the US dollar. “The market is being fuelled by improved demand coupled with the threat of a supply squeeze in Australia, the world’s largest supplier of Merino wool. Under this scenario, prices are expected to trade at current levels for the remainder of the season. Prices in US dollar terms are at historically high levels and are well above the 2001/02 levels. This bodes well for the future of the wool industry in SA,” he said. According to Johan Louw of CMW, the forecast for good wool remains strong while Australia suffers from a prolonged drought affecting quality and production. “Australian growers, who have kept wool stocks back during the previous season due to a subdued price, have now marketed their wool at current higher levels. This will result in lower offerings, and should strengthen demand levels in the near future,” he said.
Cape Wool stats: 10 789 bales were offered, 96% of which were sold. Major buyers were Stucken (2 551 bales), Modiano (1 974 bales), SA Wool Exporters (1 908 bales), ADF (1 257 bales) and Segard Masurel (1 168 bales). Average price movements for AWEX-type fleeces MF3, MF4 and MF5 of 70mm and 80mm were as follows: 19 microns were 0,5% down at R64,30/kg; 20 microns were up 0,6% at R58,76/kg; 21 microns gained 2,7% at R56,30/kg; 22 microns were 1,4% dearer at R54,50/kg, 23 microns were unchanged at R52,10/kg. – Roelof Bezuidenhout
