MARKET ANALYSIS

The penultimate 2010 sale weakened for the second consecutive week. Buyers say the downward correction was expected following the sharp increase in prices. Finer wool of 18.7 micron and finer 3% easier, including short fine wool was least affected whilst 19.5 -22 micron sold 5-7% easier.

Competition was still good although less vigour was noticeable amongst certain buyers, but still 95% of the offering was sold with Standard Wool attaining the major share.

The highest price of R84.90 on today’s sale was achieved by Elibank Boerdery from Barkly East for a 16.1 micron BH bale, which was purchased by Lempriere SA.

FORECAST:

Buyers are cautious not to carry to heavy stock volumes as these purchases will only reach their destinations in the New Year which implicates their financing situation. Cotton prices have also come down significantly the past two weeks following a similar trend to wool.

Consumers are becoming aware of the environmental impact of fibres and are requesting wool meeting the necessary carbon credentials, as well as animal friendly fibres such as mules’ free wool.The last sale beforethe Christmas recess will be heldon 8 December with approximately11,500 bales on offer.

source:Cape Wools SA