AUCTIONSPLUS wool bale sales stalled last week as Australia’s physical auction market took another backward step.
AuctionsPlus operations manager Tom Rookyard said only one line of crossbred fleece sold online last week.
The 26 micron fleece line had a low vegetable matter content of 0.2 percent and sold for 800c/kg greasy, or 1171c/kg clean. The lot was branded Coralyn Past Coy/G.T.H and was offered by Jemalong Wool.
Mr Rookyard said the backward movement in the wool market was not unexpected, after reports of little business being conducted with overseas mills, or at prices at lower than current levels.
He said the fall in the Australian dollar’s exchange rate with the US currency from US67.9 cents to US67.6 cents during the week did not aid the sliding wool market. The AWEX Eastern Market Indicator lost 25 cents to close off at 1530c/kg clean. The West Australian indicator lost 15 cents over the week to close off at 1640c/kg.
Mr Rookyard said the current market hasn’t seen positive growth since 13 November.
“The larger quantities are no doubt seeing buyers spoilt for choice.
“However, it is the upcoming holiday periods are what is impacting the market,” he said.
The Chinese New Year starts around 25 January and mills will close down for up to 15 days.
“This coupled with the Australian Christmas and New Year period shipping dates is impacting demand.
“Any exporters without orders over this period will need to finance the wool until mills resume their processing,” he said.
“Interestingly, The Chinese Lunar New Year is such an important holiday that the Chinese Vice Premier Hu Chunhua, announced that the country must resolutely work to achieve the target of recovering pig production numbers, and stabilize their pork importing supply for the upcoming holidays.”
Mr Rookyard said on the wool side, there still will be speculators buying if they see attractive levels; however, it is expected that the market will not rally with any significance in the short term.
He said there are three weeks of selling before Australia’s Christmas break, with an estimated 41,000 bales on offer this week, and 39,000 and 37,000 in the following two weeks.