CROSSBRED wool prices continued to rise at Australian auctions this week, while Merino fleece values suffered under the flood of drought-affected lines.
AWEX senior market analyst Lionel Plunkett said crossbred wool prices continued to track upward this week by generally 15 to 30 cents, whereas individual Merino Micron Price Guides (MPGs) fell by 10 to 40 cents.
He said the drop in the Merino MPGs was the reason behind the AWEX Eastern Market Indicator (EMI) falling by 8 cents this week to 2008 cents/kg clean.
“It was only the strength of the other sectors that prevented the EMI from falling further.”
The national offering reduced by 3818 bales to 45,130 bales this week, and 8.8 percent was passed in.
Mr Plunkett said a limited selection of good style wools with favourable additional measurement results and low vegetable matter (vm), came under intense pressure, as buyers fought hard to secure their share of these types.
“This strong competition meant that these better wools recorded very little change for the week.
“However, the bulk of the selection, was lesser style wools, and wools with poor additional measurement results,” he said.
“The large amount of these types meant that buyers struggled to average them into their purchases.
“The result was a continuing reduction in prices for these lots, by the end of the series these inferior types were selling at levels generally 30 to 60 cents below those achieved at the previous sale,” Mr Plunkett said.
Better prepared crossbred lines received the most attention and as a result enjoyed the largest increases,” he said.
“The only exception was 30 micron types which fell by around 20 to 30 cents.
“The strongest performing sector was the oddments, most types and descriptions rose by 20 to 50 cents, pushing the three carding indicators up by an average of 30 cents,” he said.
Next week the national offering reduces again. Currently, there are 41,722 bales rostered for sale in Sydney, Melbourne and Fremantle.
Fake fur is a real factor in crossbred prices
National Council of Wool Selling Brokers of Australia executive director Chris Wilcox last week said recent price increases for 26-30 micron wool represented a rebound in values after prices dipped in September-December last year.
The record price for 26 micron wool in mid-2018 was due in part to the ‘fake fur’ business in China, he said.
“Then prices dropped back towards the end of the year as the ‘fake fur’ fabric production season finished in China.
“Now prices are going up again as the fabric production season in China starts up again for autumn/winter 2019 in China.”
Mr Wilcox said 28-30 micron prices are going up relatively faster this time. He said it was plausible that Chinese mills are using 27.5 to 30 micron wool instead of 26 micron wool, which has helped drive the prices for these wools in the past two months.
“Supply may also be having some impact.
“The latest wool test data from AWTA shows that wool tested in Australia in the 26.6 to 28.5 micron category is down by 16.1pc for the 2018/19 season to February and the 28.6 to 30.5 micron category is down by 36pc.”
Sources: AWEX, NCWSBA.
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