AUSTRALIAN wool prices continued to rise at auctions this week, helped by stronger demand and a weaker domestic currency.
The Australian Wool Exchange said the market recorded an overall increase for the sixth consecutive selling series.
“Fremantle did not hold a sale this week, with only Melbourne and Sydney selling, and only 33,330 bales were available to the trade, 9166 bales fewer than the previous series.
“This was the smallest national offering since October last year,” AWEX said.
“This smaller offering came under heavy buyer pressure.
“Buyers fought hard from the outset, in an attempt to secure meaningful quantity of the reduced selection.”
AWEX said the strongest buyer sentiment occurred on the first selling day and this is where most of the rises were felt.
“The individual merino fleece Micron Price Guides (MPGs) added between 4 and 50 cents for the day.
“These rises combined with rises in all other sectors of the market, helped to push the AWEX Eastern Market Indicator (EMI) up by 24 cents for the day.”
AWEX said the buoyant market resulted in only 4.1pc of the day’s offering failing to meet seller reserve.
“The second selling day demand was still strong, although the bidding was more subdued and the market recorded very little change.
“The MPGs for 17 micron through to 22 micron moved between -11 and +8 cents for the day,” AWEX said.
“Only the 16.5 micron MPG recorded any significant change, adding 20 and 40 cents in Sydney and Melbourne respectively.
“The result of these movements, combined with small losses in some crossbred and oddment types, resulted in a 4 cents drop in the EMI for the day,” AWEX said.
“These daily movements ended with a weekly rise in the EMI of 20 cents, closing the week at 1468 cents/kg clean.
AWEX said Fremantle returns to the selling program next week.
“This return, combined with this week’s price rises enticing more sellers to the market, has pushed the national offering higher and 44,406 bales are expected to be offered, with all three centres in operation.”
WoolQ sells 817 bales in Western Australia
Australian Wool Innovation trade consultant Scott Carmody said the stand-out wool types in demand this week were the superfine and ultrafine wools finer than 17micron, albeit in very limited offerings.
“Most of these wools received 70c/kg or more than the previous week, but prices were regularly well over 100 cents dearer for individual lots.
“The finer the sale lot, generally the larger the price advance was,” he said.
“Significantly, a very large percentage of these wools were produced in past seasons.”
Mr Carmody said Merino combing wools, fleece and skirtings from 17.5 to 22 micron, had variable rises, but a general 10-30 cents was added to the established values, with 18.5 micron wool well sought.
“Cardings operated fully firm to marginally dearer and crossbred wools slowly recovering and added 15 to 25 cents.”
Mr Carmody said shipping issues continue to plague exporters.
“Completed contracts struggle to set sail, placing pressure on resources, both human and financial.
“This is even more relevant as relatively large offerings for this time of the season continue to be offered as grower sellers look to liquidate stocks and their freshly shorn product,” he said.
“With three weeks of selling left, exporters (and their bank accounts) are looking forward to the annual recess to relieve those pressures.”
Mr Carmody said local traders, top makers and manufacturers topped buyers lists and this widespread interest seemingly attracted stability.
“The weakening Australian dollar (down US.74 cents to 75.46 cents) assisted overseas users in dealing with a similar wool price in their currency.”
Mr Carmody said in the absence of a physical Western Australian auction this week, WoolQ Market was used as the platform for one WA broker to hold an online auction on Thursday in which 817 bales were offered, with a 75pc clearance.
“There was good activity and competition from exporters with price levels comparable to the Eastern sales achieved.”
All three centres are in action for the end of financial year sale next week and more than44,000 bales have been rostered for auction.
Click here to see the latest AWEX Micron Price Guides.
Sources: AWEX, AWI.