Crossbred prices hold up best in volatile wool sale auctions

Sheep Central, September 11, 2015

wool bales dec15-14CROSSBRED wool prices lifted up to 30 cents in late sales this week, but Merino fleece rates fluctuated across the micron ranges.

AWEX senior market analyst Lionel Plunkett quoted the AWEX Eastern Market Indicator as closing on 1260 cents clean, up two cents, for the 33,721 bales offering nationally; the second smallest three-centre offering in 12 months.

The EMI in US dollar terms was firm on US882 cents, with the SA-US exchange rate down 0.15 cents to 70.01 cents during the week. Brokers passed in 5 percent of the offering

“In contrast to recent auctions where there has been a clear direction and final result, this week the AWEX-EMI registered only a small movement over the sale.

“The two cent rise tended to mask a reasonably turbulent market; initially rising strongly before losing sizeable ground on Thursday,” Mr Plunkett said.

“The gains on the first day were most felt in Melbourne and Fremantle where there were increases of 20 cents clean for most of the Merino fleece sector.

“Sydney was more composed, firming by 5 cents,” he said.

“However that centre had been well ahead due to its outperformance during the previous sale.”

Sharp reversal on Thursday for medium and broader microns

Mr Plunkett said despite the overwhelming positive tone, Thursday followed up with a sharp reversal in direction for the medium and broader microns.

“The east coast-only encounter registered a drop of 20 cents through the 19 to 22-micron range and gave that sector a negative net result for the week.

“The finer microns were less affected, and even displayed a firming tendency for the more stylish 40Newtons/kilotex types after receiving good support,” he said.

Merino skirtings followed a similar more stable pattern, opening with moderate rises before easing back on the final day, he said.

Crossbred prices rise for smaller offering

Crossbreds were driven higher on both days on the back of a small offering, Mr Plunkett said.

“The limited 25-26 micron range recorded strong growth, mainly on the last day when they jumped 30 cents.

“The Merino carding Indicators posted another steady result, continuing their climb back to the 1100-cent level.”

Mr Plunkett said 40,755 bales are expected next week nationally, including a three-day Melbourne sale.

Volatility continues, new orders needed

Australian Wool Innovation’s Weekly Wool Market Review said while good price rises were seen on the first day of selling this week, sentiment diminished overnight and subsequently the gains were practically eliminated by the final day of selling.

The review said a good offering of Merino wool under 19 microns drawn from the New England district of New South Wales came under close scrutiny from buyers representing various destinations.

“The 19 micron and broader was the weaker sector which is the usual indicator for current buying strength.”

This week sees the annual Nanjing Wool Market Trade Conference where hopefully some positive news on wool’s immediate to short-term prospects will emerge, the review said.

“Next week’s sale has 40,000 bales rostered for sale and given the soft tone the market concluded this week, further orders will be required to arrest the trend.”

Click here to see the AWEX Micron Price Guides after this week’s sales.

Sources: AWEX, AWI, Landmark.


Your email address will not be published. Required fields are marked *

Your comment will not appear until it has been moderated.
Contributions that contravene our Comments Policy will not be published.


Get Sheep Central's news headlines emailed to you -