NFX wool trading volumes below target

Rosstan Mazey.
Rosstan Mazey.
The Natural Fibre Exchange (NFX), the independent online wool trading platform, has sold almost 5million net kilograms since its launch a year ago.

This is slightly down from initial commitments of 6.5million kilograms when it was launched in May 2018.

Rosstan Mazey, NFX director and CEO of NFX shareholder Wools of New Zealand, said the lower volumes reflected the soft market conditions over the past 12 months.

Since May 2018, the platform has managed 28 fortnightly trading events with 1415 lots of crossbred and slipe wool amounting to 4.7million kilograms sold to nine local and international buyers.

The trading manager of the platform is Boston-based CRA International, which also runs Fonterra's Global Dairy Trade fortnightly online auction of dairy commodities.

CRA's statistics over the past year show the online auction site has offered from 27 to 102 lots per event, with offered net kilograms ranging from 82,063kg to 305,359kg. Across all trading events, 84% of the offered lots and 85% of the offered net kilograms have sold.

Mr Mazey said the market and grower response to the platform had been positive, and the level of uptake was in line with the traditional ''open cry'' auctions.

He said the NFX was living up to its stated aim of connecting buyers and sellers.

''It provides trusted and transparent market-based reference prices through effective price discovery.''

Other original NFX shareholders include Alliance Group and Progressive Leathers Export.

Alliance chairman Murray Taggart said Alliance, which was ''probably the single largest seller of wool in the world'', had invested in the platform as it sought to secure efficient and transparent avenues to sell its wool.

The top cross bred price during the last trading event on July 2 was for good colour lambs fleece, which sold for $6.40/kg, while the top slipe price was $4.13/kg.

-By Brent Melville

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