Crossbred wool prices improved at auctions this week. Photo – Arcadian Wool Brokers.

CROSSBRED wool traded well to prevent a larger general fall than was experienced in Australian auctions this week.

The Australian Wool Exchange said the market fell slightly this week, with strong positive movements experienced late in the series.

“The market opened weakly and by the end of the first day Merino fleece types had suffered further falls.

“The individual Micron Price Guides (MPGs) across the country dropped by between 4 and 59 cents, 19.5 micron in the North the only MPG to not fall,” AWEX said.

“The AWEX Eastern Market Indicator (EMI) lost 13 cents for the day, with only a buoyant crossbred market (where gains in the MPGs of up 24 cents were recorded) preventing a larger fall.

“The EMI fell to 1118 cents, its lowest point since October 2020, when it was one cent lower,” AWEX said.

“The second selling day buyer sentiment dramatically improved and the market in turn started to rise.”

In the east, AWEX said the MPGs for 17 micron and coarser closed between 2 and 30 cents higher.

“The crossbreds again had a positive day helping to push the EMI up by 9 cents.

“The EMI closed the week at 1127 cents/kg clean, 4 cents lower than last week’s close.”

AWEX said with the western region selling last, it attracted very spirited bidding from the opening lot, pushing prices continually higher.

“The Western MPGs closed the day between 31 and 54 cents above the previous day.

“The increases pushed all the Western MPGs above those of the Eastern centres, setting a positive precedent for next week’s opening,” AWEX said.

“The EMI closed the 2022 calendar year at 1327 cents, to this point in the 2023 calendar year the EMI has lost exactly 200 cents, a drop of 15.1 percent.

“Compared to the corresponding sale of the previous season the EMI is 192 cents lower, a 14.6pc reduction.”

Chinese indents lead the Merino fleece buying – AWI

Australian Wool Innovation trade consultant Scott Carmody said the wool auctions had a difficult start to the selling week, with most Merino wools experiencing general losses of between 10 and 20c/kg clean, and some superfine descriptions were upwards of 50 cents cheaper.

“Crossbreds were more resilient to the negativity and traded strongly to open 15 cents dearer.”

He said some small pockets of new business overnight on Tuesday combined with a weaker AUD against the USD and saw sentiment and confidence improve rapidly and prices swiftly reversed those initial losses.

“By the close of the week’s activity, the eastern centres had recovered to near the starting basis, but significantly the WA market at Fremantle came under strong buying pressure and led to all prices 25 to 40 cents dearer for the week.”

Mr Carmody said strong indents from China led the auction purchasing on Merino lists, but the market was ably supported by two of the local traders.

“The exception was the activity of our largest exporter that still participated in buying volume, but seemingly chose not to be part of the push upwards.

“Similarly, the two largest direct buying top makers just chipped away at opportune lots rather than setting the market price for the week,” he said.

“The seasonal trend of wool growers “offering and selling” continued this series and saw just 7.5pc of volume failing to meet reserve.

“Auction sales have now sold 0.9pc more bales than at the same time last season, despite the AWTA key test data figures (below) showing a 7.4pc lower tested rate through the test house for this season compared to last year.”

Next week’s offering is of a similar size, 43,882 bales expected to be offered nationally.

Click here to see the latest AWEX Micron Price Guides.

Sources – AWEX, AWI.