Price Signals
As one who is buying wool at auction week-in and week-out it concerns me to hear commentators say that wool prices give no clear market signals to growers. The fact of the matter is that significant price differentials according to wool quality continually occur. On this fact all wool buyers would agree.
Across wool types price differences for fibre fineness (micron value), and length are the most obvious. These two wool properties are largely fixed by choice of breed and time of shearing. Next most obvious are those price differentials for colour.
Less obvious to outsiders but very apparent to wool buyers will be price premiums for differences in bulk. Price discounts for unacceptable levels of vegetable matter can occur, depending on end-use. Other wool properties such as just exceeding a minimum specified micron value can distort signals to those not familiar with market requirements. The incidence of tender wool, the degree of cotting, the unacceptable presence of unskirted pieces, pen stain, dag chip, britch wool, weak back wool, and mixed wool lengths, any of these style factors may be sufficient to cause buyers to reject bidding for a lot of wool and hence as a result of no competition to buy, a disappointingly poor wool price may occur.
The degree to which wool price differentials occur may be influenced by seasonal supply and demand factors. For example when full-length fleece wool is dominating supply, price differentials for length become less obvious. With respect to demand, the demand, the demand to fill Chinese orders currently places considerable emphasis on the right micron value.
Price premiums for Perendale Wool
In the past few seasons Perendale wool has been enjoying significant price advantages over other crossbred wools. Currently a major factor has been that the trade as a whole has little demand for the coarser lustrous type wools with little fibre crimp, particularly when these wools become semi-cotted and discoloured. Such wools have severe technical limitations in the production of machine-made carpets, and more particularly for use in knitwear.
There are sound technical and market reasons for the promotion of a movement away from our coarser wool types to those more approaching Perendale wool.
The technical reasons have been discussed in a previous story. The market reasons can be summed up by two main factors:
- The ever increasing demand from China for finer apparel wools; and
- The drive by machine-made carpet manufacturers for greater automation, ‘higher-tech’ carpet production placing tighter specification on fibre properties.
Perendale wool, having in the main the combination of being both bulkier and one to two microns finer than the majority of Romney and Coopworth wools is more suited to these demands and can be expected to continue to enjoy price premiums.
Higher Priced Wools
For those currently farming Perendales a question of importance is ‘why do some wools receive significant price premiums over others of not too dissimilar type’? ‘What is it that moves a sale lot from one that is discounted in price received because of little competitive interest from buyers on one that is keenly sought after and spiritedly bidded for at auction’?
In thinking about such price premiums we must change our minds away from one or two dominant fibre properties to the total combination of properties sought by the end user. These will vary according to end use.
Carpets/Second Shear Wools
The main criticism cited against New Zealand wools in carpets is insufficient bulk and too much lustre. Wool from average bulk Perendale sheep with the 20% improvement in bulk spoken of earlier has proved adequate to overcome these criticisms. More bulk will command a greater premium.
A minimum length is critical with 75-100mm (3 – 4 inch) shears commanding a higher price than 50-75mm (2-3 inch) wools. An expectation with shears is that they will have good scoured wool colour values in the 1.0-2.5 Y-Z values. Poorer coloured shears will be discounted. Micron value is generally of lesser importance with some clients s preferring the coarsest/bulkiest wools available (37-39 microns) provided lustre is low. Others spinning finer-count yarns may specify shears in the 34-36 micron range and with this comes a higher price.
Compared with lower-bulk wools to which criticism is levelled, typically a minimum premium of 2.5% is being paid for Perendale wools of similar micron and colour value.
It is sometimes heard that because it is for the carpet trade everything can be thrown into the press without attention to skirting. Even if the greasy wool colour is little affected by such a practice, the presence of stained yellow skirtings will lead to an inconsistent dyed colour causing buyers only wanting the best to reject such offerings.
But more importantly within a basically very white shears scourment, stained skirtings are readily seen by the client drawing attention to the shorter length component. As a consequence, what may have been a 3-4 inch shear will need to be discounted in price to a 2-4 inch price.
Carpets/Fleece Wools
Higher bulk and less lustre continue to be important. As these longer length fleece wools are generally processed on the semi-worsted system a minimum length of 100mm is required for higher prices. As many specifications request a length-after-carding test result, further price premiums will occur with increasing length. A strict adherence to soundness and avoidance of skirtings, face and top-knot wool is essential as these will inflate the short fibre-length percentage in the test result indicating wastage in processing.
For semi-worsted processing freedom from vegetable matter content is critical as to whether the wool can be used or not. 0.2% is usually the upper limit specified with 0.1% more preferable. Weak back wool, if present, can lead to discounts.
Finer micron values play an increasingly important role. For fault-free 4-6 inch fleece wools in the 34-36 micron category when compared to similar length and coloured 37-39 micron fleece wools premiums of 5-10% is commonplace. Greater premiums are evident when the comparison is made with the poorer-styled coarse wools particularly if heavily discounted cotts are taken into the equation.
Some demand exists for 33-35 micron Perendale ewe fleece wools for carpet yarn processing via the worsted processing pathway when spinning limits are critical. As combing removes vegetable matter contamination, higher (0.3 – 0.6%) VM content wools can be used without concern. If vegetable matter contamination is of an ongoing concern due to the type of country where Perendales are run, a preferred option in this instance should be towards finer wools. Flexibility for knitwear end-uses also occurs.
Knitwear/Shorn Hogget Wools
Perendale hogget wools have long been recognised as a desirable standalone fibre in knitwear. The influence on handle of micron value and lack of medullation will influence prices. Fibre crimp is important in consideration of spinnability and lowering the propensity to pilling and felting, besides the obvious importance of contributing to lightweight bulky yarns.
For the apparel industry good dyed wool colour clarity is vital so whiteness of wool is important. Also for the very best prices the need to have sound wools, free of vegetable matter and the avoidance of “wasty wools” is paramount. Strict attention to skirting and removal of neck and affected back wool is essential to gain the highest prices.
China dominates the buying of hogget wools and has very strict upper limit micron levels relating to standard types for greasy wool deliveries. Currently these are set at 32.2 and 33.7 microns. Just exceeding these values can mean quite substantial reductions in prices. Fortunately most Perendale hogget wool falls within these limits, unlike many lines of Romney and Coopworth hogget. 30-32.2 micron Perendale hogget wools can enjoy price premiums as high as 20% over coarser 34-35 micron wools.
Besides ensuring softer handling wools, I strongly suspect that these values serve also as an indirect means of ensuring higher bulk, and avoiding lustrous wools with their inherent problems. The development of the core bulk test to full international status may see greater emphasis placed on higher bulk and with it higher price premiums. Even more good news for Perendales.
Apparels/Woolly Hoggets
The ‘cream-of-the-cream’ when one is looking for the highest priced Perendale wools. Unshorn as lambs, the majority of woolly hoggets fall within a 29-31 micron category range, and 125-150mm (5-6 inches) staple length. These wools are sought for worsted processing through to the highest quality apparels and are known to be blended with Merino wools on some occasions. Soft handling, good spinnability and low wastage properties are paramount. High standards of clip preparation are essential.
These wools are difficult to grow without deterioration in colour setting in warmer moist climatic areas. And because of the presence of the lambswool tip they are very prone to catching Scotch thistle heads, a serious problem as on carding the heads breakj down into many fibre-like particles and are almost impossible to remove.
Lambswool
With lambswool it is more difficult to demonstrate benefit from choosing Perendale wool over other breeds. This is due to the naturally crimpy nature of all New Zealand crossbred lambswool. The majority of these wools enter the ‘Shetland’ trade via woollen-spun yarn production where lack of bulk is of little concern. In addition the finished knitted or woven product surface has undergone considerable modification by milling techniques which mask the influence of fibre crimp differences.
As a consequence the need for fineness outweighs consideration to increased bulk, with the need for good colour of secondary importance. Insufficient staple length may cause some limitations to end-use with a 2-3 inch the most common specified range. Users appreciate that the length variability is an unavoidable feature, and if anything may help to create a bulkier yarn.
Bedding Products/Second Shear Lambs and Short Shears
As increasing demand is being shown for wools suitable as fillers in duvets and mattress overlays. Traditionally Down-type wools are used but the highest bulk Perendale wools are very suitable. Strict minimum high-bulk cut-off values are required as in addition to occupying space without weight, it is essential that these wools are not prone to felting and matting. Price premiums can be quite substantial giving a very nice reward to 2-3 inch wools which otherwise could be quite heavily discounted for length reasons.
Conclusion
For the right Perendale wool, growers will be well rewarded for their efforts in breeding, growing and clip preparation. Treat your wool as a specialty wool at all times. Seek advice to maximise your returns. Brokers and wool buyers will only be too happy to assist.