The re-entry of Chinese buyers onto the global wool market suggests the Chinese Government will lift its ban on the issuing of new import licences, a New Zealand wool industry leader says.
China's Ministry of Finance and Commerce rocked the $4 billion Southern Hemisphere fleece trade last monthwhen it announced its 2007 global import tariff quota for wool and wool tops had been fully allocated only seven months into the year.
Last week Trade Minister Phil Goff said the New Zealand Government was doing all it could to ensure the action did not disrupt New Zealand wool exports to China, worth around $170 million for the year ending March 2007.
While China is New Zealand's top market for wool, taking around 30 per cent of its clip, it takes a staggering 70 per cent of Australia's production.
Meat and Wool New Zealand boss Mike Petersen said Australian news reports last week showing a spike in prices suggested Chinese buyers had re-entered the market.
"What I can imagine has happened is that Chinese buyers are confident they're going to get quota [to import wool] and they might have actually started buying ahead of time," he said.
There was "significant buying" on the Australian wool market last week, with prices increasing by up to A52c for some microns, according to the Australian Broadcasting Corporation.
"That would certainly indicate to me that if they haven't got quota yet then they're about to get it and they've decided they can go ahead with confidence and buy and that's good news," Petersen said.
Government officials last week told him the Chinese would start reallocating quota in August for use in September.
Petersen said he understood that while the quota for importing wool had been fully allocated to importers, they had yet fill them.
"It appears the two companies that have still got quota have been given the okay to use it but no one's too sure."
