New Zealand merino wool prices are being pushed up as drought in Australia prompt farmers across the Tasman to cull stock, reducing the amount of the fine premium wool available for sale.
Eighteen-micron Merino wool, considered a benchmark for the fibre, sold at $28.90/kg at this week's South Island auction. That was up from $22.40/kg at the same time last year and the five-year average of $16.70/kg for this time of year, according to AgriHQ.
Merino sheep are renowned for their soft, fine wool which is sought worldwide for luxury clothing and other high-value textile products. Australia is the world's largest producer and a drought in that country is impacting global supplies at a time when demand is increasing, pushing values higher.
"The market has gone from strength to strength with prices reaching new heights," AgriHQ analyst Reece Brick said in his September sheep and beef report.
"Drought conditions through New South Wales have ballooned the Australian mutton kill, restricting the global supply of quality Merino wool, and therefore lifting interest in New Zealand product."
