19 Feb 2010

Wool prices slip as dollar strengthens

6:08 am on 19 February 2010

A rising dollar has eroded some of the gains made in wool prices in recent weeks.

Wool Services International says prices for most wool types fell at the North Island auction on Thursday.

The exporter says the main contributor was the strengthening of the New Zealand dollar by more than 1.5% against main wool trading currencies, since last week's sales.

Prices for fine crossbred shears dropped by up to 4.5%, coarse fleece and shears were up to 3% and lambs fleece, in hot demand lately, softened by 1% - 2.5%.

The auction was small with 8600 bales offered, of which 81% were sold.

WSI says lack of buying activity from China because of New Year holidays, and larger offerings for next week's auctions also contributed to the fall in prices.

It reverses a steady lift in auction prices this year, which exporters have seen as a sign of a sustained recovery in wool prices and demand.