The wool market made a turnaround following last week’s poor performance and the prices of most types posted solid gains. Cape Wools’ Merino Indicator subsequently rose 4,8% to close at R60,68/kg (clean). This is up 8% on the opening level, according to spokesperson Ona Viljoen. “This week’s price hike can be attributed mainly to the weaker rand, which on Monday broke the critical level of R7 to the US dollar; and to an upward correction that brought local prices more in line with Australian levels.
Although the rand had regained some lost ground since Monday, at R6,96, it was nevertheless down 3% against the dollar compared with last week. It was 2,7% weaker against the euro,” she says. According to James de Jager of CMW, inferior white wool breeds were under pressure and in certain cases moved downward due to the high levels of stocks in the hands of processors.
The two most expensive lots on the CMW sale were purchased by New England Wool which paid R78,40/kg for a lot of 16,6 micron AFFY from Faskally Farms, Barkly East, and R75,75/kg for a lot of 17,5 micron BH sold by B de Bruin from Cathcart. Meanwhile, says De Jager, China has declared that no trading of wool import quotas will be allowed from January 2008. “This caused processors, who were short of stock, to pay an additional tariff (as high as 38%) to import wool outside the quota system. The new quotas in force from January 2008 should support these levels.” Ken Craig of BKB says his market indicator is now 37% higher than a year ago, while over the same period the rand has appreciated by 2% against the US dollar. Cape Wools statistics: all good Merino styles were dearer, but the finer end of the market posted the biggest increases. Average price movements for AWEX-type fleeces MF4 and MF5 of 70mm and 80mm were: 19 micron rose 8,3% to R75,40/kg; 20 micron gained 5,7% at R67,12/kg; 21 micron was 4% dearer at R60,96/kg; 22 micron was up 4,8% at R59,03/kg; and 23 micron gained 4,5% at R56,83/kg. There were no quotes for 24 and 25 micron. Altogether 9 053 bales were offered, achieving a clearance rate of 97%. Major buyers were Modiano (2 320 bales), Standard Wool SA (1 521 bales), Chargeurs (1 341 bales) and ADF (1 177 bales). – Roelof Bezuidenhout