NZ wool prices ease in first sale of 2015/16 season amid weaker demand

Wool prices at this week's auction fell, particularly for varieties sourced from the North Island. Photo / NZME.

New Zealand wool prices eased in the first sale of the new 2015/16 season as demand weakened.

The price for clean 35-micron wool, a benchmark for crossbred wool used for carpets and accounting for the majority of New Zealand's production, declined to $5.75 per kilogram at yesterday's North Island auction, from $5.80/kg at the last auction of the 2014/15 season on June 25, according to AgriHQ. The price for lamb wool was unchanged at $7.20/kg.

Wool prices softened at the latest auction even as a decline in the New Zealand dollar made it more competitive for overseas buyers in a typical slower period for the market.

"There is currently the typical seasonal slow-down occurring due to well stocked supply in China which is resulting in reduced new orders for wool temporarily," said AgriHQ analyst Emma Dent.

Some 6,801 bales were offered at yesterday's auction, with a 92 percent clearance rate.The next auction scheduled for July 16 in the South Island will offer 7,800 bales.

The value of wool exports increased 11 percent to $793 million in the year through May, compared with the year earlier period, making it the country's 13th most valuable commodity export, according to the latest data from Statistics New Zealand.

For the month of May, clean wool export volumes declined from April but were ahead of year earlier levels, AgriHQ said.

Volumes to China, the country's largest market, were down 12 per cent in the month but were 6 per cent ahead of year earlier levels.