Wool prices improved again this week, helped by the low Australian dollar, stronger demand for improved quality wool and December shipment pressure.

Crossbred wools again met solid demand and reached fresh three-year highs after rising 10 to 15 cents, AWEX senior market analyst Lionel Plunkett said.

Mr Plunkett said the wool market made an encouraging recovery this week, rising nine cents for the week, with the AWEX-Eastern Market Indicator finishing on 1065c/kg. Brokers offered 52,367 bales for a pass-in rate of 7.4 percent this week, in Sydney, Melbourne and Fremantle.

Low Aussie dollar helped demand

He said movements in the Australian-US dollar exchange rate helped wool prices. The Australian dollar at one stage made a fresh four-year low, dipping below 85 US cents, before recovering some ground on Thursday. The EMI gained seven cents in US$ terms to finish on 907 cents.

The market initially opened the week tentatively with the softer tone from last week persisting into this sale on the first two days, Mr Plunkett said.

“The Melbourne sale, which was held over three days to allow for its largest sale in nine months, was as much as 10 cents cheaper midway through the week, although by the close of Wednesday there were positive signs emerging in the broader Merino microns.

“Thursday was more upbeat for most microns where there were improvements of 5 to 10 cents,” he said.

Ultrafine wools continue to struggle

Mr Plunkett said ultrafine microns were one of the few areas to struggle during the sale.

“Selected types continued to attract good competition but some of the lower spec types lost ground.”

Merino skirtings were well-supported during the week and generally closed 5 to 10 cents higher, he said. Merino cardings firmed slightly for the week.

Mr Plunkett said volumes are expected to remain high in the lead-up to the Christmas recess. A combined 107,000 bales is expected in the next fortnight and the 56,290 bales forecast for next week will be the largest sale in almost two years.

‘Ripper’ sale helped by crossbred demand

Fox and Lillie Rural technical and marketing manager Eamon Timms said the sale this week was “a ripper”. Demand is really good for crossbreds to go into interior textiles and outer wear garments, he said.

He said Australian crossbred wool is traditionally finer than supplies from New Zealand or the United Kingdom.

“That’s one reason why the Australian market gets a fair bit of attention on the crossbreds.”

Mr Timms said the low Australian dollar helped Merino prices improve between Tuesday and Wednesday.

“Tuesday was a slack market but Wednesday got tight and Thursday got tighter, that was certainly dollar related.

“The crossbreds have just been steaming along regardless, it all comes back to just a heap of demand,” he said.

Mr Timms said he “didn’t see a lot of downside in the market” in coming weeks. There was also some December shipment pressure on buyers to secure wool now, he said.

“This week and next week are really the two weeks you have got to get wool to get it on a boat to make December shipment to China.”

Quality of wool on market is improving

The improving quality of the growers’ offering was also a factor in the market, according to Australian Wool Innovation trade consultant Scott Carmody.

He said the volumes of wool types with a high Pobm (position of break in the middle) were diminishing and more availability of lower Pobm wool for buyers to average orders with, has allowed the price gap to narrow.

“An exception is the fleece wools finer than 16.0 micron with high Pobm and low strength, which are very difficult to place into standing orders.”

He said crossbred fleece of 25 to 32 microns again hit very strong demand and under a relatively massive volume of more than 10,000 bales, rose a surprising 15ac clean/kg.

“Each passing week, buyers are expecting a slow down, but demand through strong Chinese indents keeps kicking prices up.”

Melbourne sale opened with lacklustre demand

Landmark wool risk manager Anthony Boatman said Melbourne opened sales on Tuesday with lacklustre results in the Merino fleece catalogue.

“Price were generally around five cents under last week’s closing levels, while the 19 micron categories recorded the heaviest losses, quoted down 15 cents.

“Oddments however sold well, recording a firm to unchanged result.”

He said crossbred fleece maintained good support with most categories lifting 5c to 10c higher.

“Further softness amongst the fine wools saw reductions of another 1-4 cents for 17.5 and finer wools on Wednesday, while other fine wools were unchanged.

“Medium to broad wools improved, recording gains of 5-10 cents, with prices rallying towards the end of the day’s trade,” he said.

Crossbreds again sold well with all categories a few cents higher, and oddments also sold firmer on Wednesday.

Steady buyer support on Thursday pushed most categories higher again, Mr Boatman said.

“The better performing categories were among the 17.5-18 microns, along with the 20 and 21 micron categories, which lifted up to 10 cents.

“Crossbreds lifted 3-4 cents across the board and oddments also closed the sale higher.”

Sydney hosted superfine sale

In Sydney’s superfine sale, the best and spinner style wools with high tensile strength measurements were highly sought after, Mr Boatman said.

“Other fine wools were a little softer, but prices did tend to push higher towards the close.

“Medium microns also struggled early, with the 21 and 22 micron lots the only categories to record a positive result.”

He said crossbred fleece sold very well, with prices generally around 10 cents higher for the 25-32 micron categories. Oddments were little changed.

On Thursday in Sydney, the market closed on a firmer note, with most fine to medium micron lots selling up to around five cents higher.

“There was a little softness in the 17 micron and finer wools offered

“However, best and spinners style wools continued to attract solid premiums,” Mr Boatman said.

Crossbreds and oddments again sold well, with most categories lifting a few cents higher.

Fine wools lift 10-15 cents in Fremantle

Fine wools lifted a few cents higher in the firmer opening sale  in Fremantle, while the medium micron offering sold at levels unchanged from last week, Mr Boatman said.

Oddment categories also sold well, generally pushing around 5c higher.

Prices made very good gains on Thursday, as buyer support lifted for all types.

“The fine wools saw increases of 10-15 cents, while medium micron wools saw less uniform, gains, ranging from one cent for the 20 micron categories, to 13 cents for the 21 micron wools.”

He said oddments were a little softer.

Sources: AWEX, Landmark, AWI, Fox and Lillie Rural.