CHINA’S largest top makers dominated Merino fleece buying at auctions across Australia this week as lower supplies are expected in coming weeks.

The Australian Wool Exchange said the market had a fluctuating week, recording positive and negative movements across different wool types, resulting in very little change to the overall market.

“With just six selling series remaining in the 2024/25 season, we have a more accurate picture of the national quantity offered.

“This week the national offering increased to 30,931 bales (2423 more),” AWEX said.

“Season to date there have been 1,410,070 bales put thorough the auction system, this is 226,420 less than the previous season, a reduction of 13.8 percent.”

AWEX said selling results on the opening day were mixed.

“The movements in the individual AWEX Micron Price Guides for Merino fleece ranged between positive 28 cents (17.5-micron in the south) through to negative 33 cents (23-micron MPG in the south).

“The skirtings recoded minimal movements, the oddments reduced slightly, while the crossbred sector recorded a small overall rise,” AWEX said.

“The result of these market movements was a one-cent rise in the benchmark Eastern Market Indicator.

“This was the first daily rise in the EMI in eight selling days,” AWEX said.

“The news in USD terms was not as positive, currency fluctuations meant that when viewed in USD the EMI lost ground, finishing the day US10 cents lower.

“On the second day, only Sydney and Melbourne were in operation and again the market movements were varied across wool types and microns.”

AWEX said the MPG movements across all sectors ranged between positive 15 cents (28 micron MPG in the north) through to negative 20 cents (19 micron MPG in the north.

“The skirting market recorded little change while the oddment sector recorded further small falls.

“The EMI dropped three cents for the day.”

AWEX said a reversal in currency movement meant this time the news was positive in USD terms, the EMI gained US9 cents for the day.

Price falls largely arrested – AWI

Australian Wool Innovation trade consultant Scott Carmody said price falls at the Australian wool auctions were largely arrested this week.

“Some clearer macro-economic signals were delivered globally and this did transfer somewhat into the sale rooms, albeit with demand for new business slow to emerge and tentative at best.

“What did arise though was some injection of confidence into the market from China’s two largest Merino top makers who between them, purchased upwards of 38pc of the entire sold Merino fleece offering.

“The significance of that first stage manufacturing buying cannot be underestimated,” he said.

“The auction methods of operations generally see traders focussing on what to trade (buy/sell) in the very short to immediate term, whilst manufacturers look to see and plan for the anticipated demand a few months out, given the lag time for delivery and processing to their mills.

“After a few quiet weeks, this appears to be a reset and hopefully reverting to the season long confidence building that was apparent a month ago,” Mr Carmody said.

“Factors at play this week was a market trying to realign price differences between centres, whilst dealing with the ever-changing forex rates.

“This was most apparent with our most voluminous centre of Melbourne recording price increases ( +5 to +25 cents) on all types and descriptions except for Merino wools around 21 micron (-10 cents) and the carding sector (-29 cents) whilst Sydney saw reductions of 10 to 20 cents on all Merino guides,” he said.

Mr Carmody said Fremantle sold at similar levels to last week at its one-day only auction.

Mr Carmody said crossbred wools of all descriptions were the highlight of the week with gains of 5 to 15 cents recorded across the offering.

“This type sector is generally the most exposed to the vagaries of forex movements, but this week that trend was broken as prices moved against stronger dollar as auctions were conducted.

“Cardings remained softer in both pricing and ability to readily sell.”

Mr Carmody said lack of supply will be most evident in the next few months.

“Drought conditions are prevailing and spreading across more wool growing regions reducing both cut/head and yields, reducing clean weights being available.”

Around 30,000 bales are being offered next week, with the WA centre at Fremantle selling just one day, Tuesday.