Wool prices soared for a second consecutive week despite a large offering. Cape Wool’s Merino (CWM) indicator finished the day up 5,4% on last week at R64,65/kg (clean). “This is a seasonal high, up 15,5% on the opening sale, and 3,7% above the previous high of R62,35/kg (clean),” says Ona Viljoen of Cape Wools. “The drop in the value of the rand, which was trading down 3,5% against the US dollar at R7,09, contributed to the price hike.
“The rand also was 1,9% weaker against the euro at R10,34. The Australian indicator closed 1,3% higher,” Viljoen explains. But in contrast to last week, when the medium wools made the biggest gains, this week saw the finer end of the market posting the biggest increases, with 19 microns gaining almost 8%, while 20 microns were up by almost 7%. According to CWM, combing types had the biggest advantage, due to European processing shortages. Shorter wools were less fortunate due to subdued competition and only increased slightly.
The limited supply of quality and long wool will remain the driver to the end of the season, although rumours indicate processors are investigating other fibres to maintain production. Ken Craig of BKB says the Merino indicator is the highest since 2 October 2002 – even bearing in mind the R10,37 rand/dollar exchange rate against today’s R7,14, which is 30% stronger. “Welcome rains continue to fall in the larger wool growing areas, which is good news for wool production and quality in the forthcoming months,” Craig says. According to Cape Wool’s statistics, 13 232 bales were offered, of which 97% was cleared to the trade. Major buyers were Modiano (2 662 bales), Standard Wool SA (2 454 bales); Chargeurs Wool (2 335 bales); Segard Masurel (1 599 bales), and Stucken (1 520 bales).
Average price movements for AWEX-type (organisation of local and international wool brokers) fleeces, MF4 and MF5 of 70mm and 80mm were as follows: 19 microns gained 7,8% at R83,90/kg; 20 microns increased 6,8% at R73,52/kg; 21 microns were 6,2% dearer at R66,58/kg; 22 microns increased 6,3% at R64,23/kg; 23 microns were up 4,7% to R61,27/kg, but there no quotes for 24 microns and 25 microns. – Roelof Bezuidenhout.
