STRONGER buyer competition and lower Australian dollar exchange rate helped the Australian wool market record large gains this week, ending a run of several consecutive weekly losses.

The Australian Wool Exchange said 27,077 bales were offered, 2055 bales more than last week, and 6.9 percent were passed in.

“The largest rises were recorded on the first day of selling.

“Across the country the gains in the merino fleece Micron Price Guides (MPG) ranged between plus 25 and plus 79 cents, with the gains felt across the entire Merino spectrum,” AWEX said.

“The strongest buyer demand was focussed on good/best style fleece lots and those possessing favourable additional measurement results, particularly those with low midpoint of break, these lots achieved the largest increases.

“The benchmark Eastern Market Indicator (EMI) rose by 24 cents for the day, ending its run of six consecutive falls,” AWEX said.

“This was the largest daily rise in the EMI since the beginning of September.

“After dropping below 1700 cents in the last series, its lowest point since February, the EMI rose to 1722 cents/kg clean.”

AWEX said the market was heavily influenced by currency, due to a large drop in the Australian dollar (AUD) compared to the US Dollar (USD). When viewed in USD terms the market only added one US cent for the day and the EMI closed the day at US1192 cents/kg.

“On the second day, the market generally consolidated the gains of the previous day, although there were pockets of lower prices, particularly in the nNorthern region.

“The Merino fleece MPG movements ranged between plus 18 and minus 22 cents,” AWEX said.

AWEX said the 17.5 to 18 micron wool in the north posted the biggest losses and the EMI remained unchanged on 1722 cents/kg.

“The passed-in rate dropped considerably as most sellers were happy to accept the higher prices on offer.”

Market rebounds – AWI

Australian Wool Innovation said stronger buyer competition and a lower Australian dollar provided renewed support.

The Eastern Market Indicator (EMI) gained 24 cents to close at 1722 c/kg clean, although in US dollar terms the EMI fell seven cents to US1184 c/kg, indicating currency movements contributed to the recovery in local prices.

“From the start, Tuesday’s market opened strongly, with the EMI gaining 24 cents, its largest daily rise since early September.

“Merino categories increased across the country, with good-style, well-measured wool again attracting the strongest competition,” AWI said.

“Chinese processors were particularly active with exporter-traders following closely.

“Wednesday brought consolidation, with the market remaining relatively unchanged and traders became more prominent,” AWI said.

“Better-style and specification wool, particularly low mid-break and low-CVH descriptions, attracted significant premiums, while poorer-quality and broader topmaking types remained comparatively subdued.

“Underlying supply remains constrained, with season-to-date offerings13.0% below last season,” AWI said.

“Despite the recent market correction, the EMI remains US233 cents, or 24.5pc, above the corresponding sale last season, compared with an 18.1pc increase in Australian dollar terms.

“This highlights the substantial year-on-year improvement in wool prices from an international buyer’s perspective, despite recent currency-driven volatility.”

AWI said with about 30,500 bales forecast for Week 21, the market will face another test of whether renewed processor participation and improving clearance rates signal more sustainable demand, or whether recent gains primarily reflect currency movements and short-term inventory requirements.