AUSTRALIAN wool prices have posted their biggest weekly gains since September last year, driven by low global raw wool stocks at processors.
Prices increases of 95-185c/kg clean across the Merino fleece micron categories and 17-45c/kg increases in crossbred wool values pushed the benchmark AWEX Eastern Market Indicator up 99 cents to 1036c/kg.
“This was the largest weekly lift in the EMI, in both cents and percentage terms, since September 2019,” AWEX senior market analyst Lionel Plunkett said.
Demand this week was reportedly driven mainly by Chinese demand, with growing interest from Europe and India, as processors returning to work from COVID-19 lockdowns seek to lift their raw wool stocks.
Mr Plunkett said despite the price rises of the previous two weeks, the national quantity fell by 6148 bales to 23,620 bales, with brokers passing in 2.7 percent.
“Only Sydney and Melbourne were in operation on the first selling day (Tuesday) and strong buyer demand helped to push prices higher from the outset, with the finer sector attracting the most buyer interest.
“By the end of the first day the individual merino Micron Price Guides (MPGs) in the east had risen by 58 to 106 cents,” he said.
Mr Plunkett said prices continued to climb on the second day and the MPGs in the east added a further 29 to 101 cents.
“In Fremantle — which did not sell on the first day — the rises in the MPGs were much higher, 94 to 132 cents.
“The EMI gained another 40 cents for the day.”
Mr Plunkett said the skirtings again followed a similar path to the fleece, with general rises of between 80 and 140 cents. The 18 micron and finer skirtings were most affected.
“The crossbreds also increased, but not at the same rate as their Merino cousins, and the MPGs for 26-30 micron added 17 to 45 cents for the series.
“The oddments too recorded solid gains, this was reflected in the Merino Carding Indicators (MC) which rose by an average of 61 cents,” he said.
Export traders have a new aura of confidence – AWI
Australian Wool Innovation trade consultant Scott Carmody said the new firm order business of the past three weeks has seemingly given export traders a new found aura of confidence from which to stimulate trade.
“All three auction centre purchasing were clearly dominated by the local buyers, with the Chinese indent operators and overseas top makers picking up minimal quantities only.
“A smattering of European and Indian purchasing was evident but purchased volumes for those destinations remain relatively low,” he said.
“This week was a designated superfine sale week, and the premier Italians did not appear on buyers’ lists.
“The wool types on offer this week were largely unsuitable for Italian processors and this was probably the reason for their low buying numbers, together with the current retail circumstances.”
Mr Carmody said coinciding with this new positive sentiment from the buying side, sellers have also managed auction volumes to extract the most out of an appreciating market by limiting the volumes up for sale each week.
“The national weekly volumes of sub 30,000 bales have aided in price recovery as the current demand has at least matched or exceeded supply.”
Next week’s national offering increases to 33,239 bales, with all three centres in operation over both days.