7 Feb 2012

High dollar seen as killing wool trade

6:31 am on 7 February 2012

Wool exporters say they have had enough of the damage an over-valued New Zealand dollar is doing to the trade.

Wool Exporters president John Dawson says the market indicator or average price for strong wool has dropped from a peak of about $6.40 a kilo at the height of the wool recovery to not much more than $5 now.

He says farmers and exporters are seeing the gains of the past year being swallowed up and a lot of that is due to the inflated dollar.

That, Mr Dawson says, is making New Zealand wool a lot more expensive for buyers in overseas markets, making it difficult for the product to compete against man-made fibres and against wool from other producers.

He says exporters are frustrated that currency speculation fuelled by relatively high interest rates, is playing a large part in keeping the New Zealand dollar volatile and high.