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NZ wool prices advance on lower kiwi

NZ NewswireNZ Newswire 8/04/2016 Tina Morrison

New Zealand wool prices advanced at this week's auction as a lower kiwi dollar and increased competition for specific fibres bolstered demand.

Strong wool of 39 microns rose to $5.75 per kilogram at Thursday's South Island auction, from $5.70/kg at last week's North Island auction, according to AgriHQ.

Strong wool, which makes up the majority of New Zealand's production, is trading about 14 per cent higher than at the same time last year.

Lamb wool of 30 microns gained to $6.40/kg from $6.10/kg last week, as demand increased for coarser lamb wool with the general indicator price for the fibre lagging behind at $6.24/kg, AgriHQ said.

The auction clearance rate rose to 91.6 per cent, from 86 per cent at last week's North Island auction, and 81 per cent at the previous week's South Island auction.

There was strong competition for wool types that met buyers' contract requirements, although wool types that didn't meet buyers' contract specifications traded at a discount, said AgriHQ analyst Shaye Lee. Buyers were generally looking for finer wool with less contaminants, like seed, on the fleece, she said.

The slightly weakened New Zealand dollar against the US dollar also added some positivity to the market, she said.

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