AUSTRALIA’S largest wool offering in five weeks has tested demand and prompted increased grower withdrawals from auctions.

The Australian Wool Exchange said the market recorded an overall loss this week, with the benchmark Easter Market Indicator falling 17 cents to 1803c/kg clean.

Brokers catalogued 33,265 bales nationally, 7030 bales more than the previous auction series.

The Passed-in rate lifted 2.5 percent to 9.4pc.

“Season to date, the total amount of bales offered continues to track below the previous season,” AWEX said.

“There has been a total of 369,025 offered, this is 48,774 fewer bales than the previous season, a drop of 11.7 percent.”

AWEX said the market generally retracted on the first day of auctions, although good style wools possessing favourable additional measurement results were well supported and recorded very little change.

“The finer microns were also well supported, with gains recorded, particularly in the north and the west.

“The Micron Price Guides (MPG) movements across the country ranged between plus 14 and minus 32 cents.”

AWEX said the benchmark Eastern Market Indicator (EMI) dropped by 7 cents, falling to 1813 cents/kg clean on the first day.

“With minimal currency movements, the EMI fell by a similar amount in US dollar terms, the EMI fell by US6 cents for the day.”

“On the second day, with just Sydney and Melbourne in operation, the market continued to fall,” AWEX said.

“Again, good style, good additional measurement wool attracted good demand and sold at very similar levels to the previous day.

“Lesser style types and those with poor additional measurement results did not receive the same level of support and were the driving factor in the overall softer market.”

AWEX said the MPGs dropped by between 3 and 32 cents, only the 17.5 micron MPG in the north recoding a positive result.

“The EMI lost 10 cents.

“Despite the recent losses, the total dollar amount of wool sold is well above the corresponding sale of the previous season.”

Season to date there has been $609 million worth of wool sold through the auction system, $107 million more than the previous season.

Benefits flowing to fine and superfine growers – AWI

Australian Wool Innovation said the largest national offering in five weeks tested buyer appetite.

AWI said the designated Sydney superfine sale highlighted the increasingly pronounced quality differentiation.

“Almost 18,900 bales of 19.5 micron and finer wool were offered nationally, with better style and specification continuing to command premiums.

“Strong competition was seen from the opening lot, with traders again leading the buying and Chinese processors following,” AWI said.

“Importantly, even poorer-specification superfine wool was not neglected, suggesting reasonable underlying demand despite the larger catalogue.

AWI said AWEX’s indicative wool grower returns show that a 185 kg bale of 17 micron wool is currently worth around $3103, up $618 or 25pc from $2485 in Week 16 last year, while 19 micron has risen from $2107 to $2679, an increase of $572 or 27pc.

“Returns for 21 micron wool have increased more moderately, from $1985 to $2185 per bale (+10pc), while the indicative value of a 28-micron bale has risen from $797 to $914 (+15pc).”

AWI said the comparison highlights that the strongest benefit has flowed to fine and superfine Merino producers, consistent with the widening premiums evident across the market.

“With the Week 17 offering forecast to fall to around 26,883 bales, reduced supply may again provide some price support, although buyer selectivity and the widening premiums for quality and specification are likely to remain key market features.”

Sources – AWEX, AWTA.