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NZ heads for lowest wool clip in 6 years

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New Zealand, the world’s largest exporter of crossbred wool, is heading for its smallest annual wool clip in six years, reflecting the lowest sheep flock in more than 70 years. This is due, according to a report published in New Zealand press, that sights dry conditions and an increased focus on meat producing breeds of sheep as the cause.

New Zealand will probably produce 138,400 tonnes of greasy wool, or 833,700 wool bales, in the annual season that runs through June, down 5.4 per cent on the year earlier, according to farmer-owned industry organisation Beef + Lamb New Zealand. That would mark the lowest level since the 2008/09 season when the clip dropped to 132,400 tonnes as farmers eschewed a second shear in the face of low wool prices.

The national clip is likely to decline further in the upcoming season starting in July, falling to around 810,000 bales, according to Christchurch-based New Zealand Wool Services International, a unit of Australia’s Lempriere and the nation’s largest exporter.

New Zealand’s wool production has slumped in line with a reduction in the national sheep flock, which last year dipped below 30 million for the first time since 1943. Farmers in search of higher returns are converting their operations to dairy and switching to higher yielding meat breeds such as Finn and Texel and away from the traditional wool-focused Romney. Recent drought conditions have also dented the wool yield.

“Production is tracking the decline in sheep numbers and given that it has been a relatively dry season, you will be hitting quite historical lows,” said Rabobank commodity analyst Georgia Twomey. “It’s a by-product of pretty low returns for quite a long time.”

China expects New Zealand’s future wool production will be driven more by local farm management decisions than offshore demand, as more farms have been converted to dairy production.

“There used to be a gypsy affect for sheep around the country, that if one area was experiencing drought, they could often shift their sheep to an area that had lots of grass to get through the drought and then bring them back,” he said. “That ability in many cases has now disappeared so farmers in dry land areas in particular can only farm with stock levels that they can sustain themselves and if they get above that and strike adverse conditions the excess stock has to go to slaughter.”

Source: The New Zealand Herald


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