MORE Australian wool growers met the market this week as Merino and crossbred fleece prices improved.
AWEX senior market analyst Lionel Plunkett said the Australian wool market experienced an unusual week, with all Merino and crossbred fleece types recording increases of up to 29 cents.
However, there were significant losses in the oddments and lesser losses in the skirting market, meaning the market recorded a small overall loss.
The national offering reduced to 30,272 bales, 12,492 fewer than last week and most sellers were keen to accept the higher prices on offer, Mr Plunkett said.
The national passed-in rate dropped to 8.2 percent, 21.8pc lower than the 30.1pc rate of last week.
“The smaller fleece offering attracted strong widespread competition, this stronger buyer sentiment helped to push prices higher.
“Across the country the individual fleece Micron Price Guides (MPGs) rose by 2 to 29 cents,” he said.
“The crossbreds also posted increases and the crossbred MPGs rose by 4 to 23 cents.”
Mr Plunkett said the skirting market suffered small losses, and all types and descriptions generally fell by 20 to 30 cents.
“As mentioned earlier, it was the dramatic losses in the carding sector that pushed the market down overall.
“Locks, stains and crutchings generally fell by 70 to 90 cents,” he said.
“On the back of these losses, the three merino carding indicators (MC) fell by an average of 72 cents.”
Mr Plunkett said due mainly to the large losses in the carding sector, the AWEX Eastern Market Indicator (EMI) fell by a marginal two cents to close at 1004c/kg clean.
“Compared to the corresponding sale of the previous season, the EMI is 509 cents lower, a drop of 33.6pc.
“The EMI is now at its lowest point since August 2014,” he said.
“Due to currency movement, when in viewed in US dollar terms, the fall in the EMI was slightly higher, the EMI lost US8 cents.”
Market is trying hard to find a base
Techwool Trading export trade manager Evan Croake said the market is trying hard to find a base on the back of negative economic sentiment around the world.
Mr Croake said the losses in the oddment sector are being attributed to a lack of orders from main buying country Korea.
“The other thing is that there is a bit of a backlog of built up wool because of the off-season, there are just not enough orders in the market cover what is there.
“It is pretty well-known that there is still a lot of wool on hold,” he said.
Mr Croake said the large offering in the first week after the recess was too much for the orders in the market.
“I think as we see quantity drop back a little bit, we get back to a level where it is closer to supply and demand.
“I think that’s what we saw this week, particularly on the Merino fleece side.”
He said the reduced offering of 30,272 bales, 12,492 fewer, helped the market to stabilise.
“I don’t see any upside, I still think we’ve got to get used to lower prices due to COVID-19 and while coronavirus is around we’ve got to get used to these prices in the short-term.
“But if quantities similar to this week or a bit lower then I think the market will start to stabilise and maybe we will find a bit of a base.”
Mr Croake said growers able to meet the market and sell were doing the right thing.
“In the short-term it helps move the wool through the system and a lot of these growers have probably got their second clip coming off.
“It is better to see wool moving through the system and transacting than it to see it build up stocks, because ultimately any build-up of stocks is going to restrict any recovery when it actually starts,” he said.
Next week’s national offering increases slightly. Currently, there are 35,252 bales on offer nationally. Fremantle again only requires a one-day sale due to quantity, selling on Wednesday.
AuctionsPlus reports consistent online sales
AuctionsPlus reported consistent demand on its online offer board during the week.
AuctionsPlus commercial manager – digital services Tom Rookyard said 268 bales were sold.
The top price of 1228c/kg greasy or 1878c/kg clean was paid for a 15 micron Merino fleece line branded Brooksdale/F with an average staple length of 89mm and 2 percent vegetable matter content.
In other lines, a 16 micron fleece sold for 1000c/kg greasy or 1637c/kg clean, and a 17 micron line made 955c/kg greasy or 1380c/kg clean. The 18 micron lines sold to 845c/kg greasy, or 1271c/kg clean, and the 19 micron fleece lines made to 825c/kg greasy, or 1112c/kg clean. The 20 micron lines made to 737c/kg greasy, or 1083c/kg clean, and the 21 micron lines sold to 700c/kg greasy, or 1080c/kg clean.