Wool Market Reports

New wool contracts help to lift Australian auction prices

Sheep Central, March 1, 2024

THE Australian wool market has managed an overall increase after six consecutive selling series of no overall positive movement, the Australian Wool Exchange said this week.

The national offering fell slightly to 38,137 bales and brokers passed in 6.5 percent.

“Compared to the corresponding sale of the previous season, there has been just 8,280 more bales offered, an increase of 0.7 percent,” AWEX said.

“In the Merino fleece, the market movements were varied, although across all microns, any good style wool possessing favourable additional measurement results, continued to attract very strong support, generally recording only positive movements.

“The other standout was the 19.5 micron group,” AWEX said.

“Strong demand pushing prices higher, but the individual Micron Price Guides (MPGs) for 19.5 micron were the only ones to post an increase in all three centres (between 7 and 16 cents).

“The MPG movements across the country ranged between minus 26 and plus 16 cents for Merino fleece.”

AWEX said the market was stronger on the first selling day, and the AWEX Eastern Market Indicator (EMI) added 4 cents, closing day one at 1161 cents/kg clean.

“The second day the market eased across all three selling centres.

“The EMI gave back 3 cents of the first day’s gain, closing the week 1 cent higher at 1158 cents.”

AWEX said after rising last series in USD terms, currency movement has prevented the EMI from doing so again.

“The EMI dropped US4 cents, closing at US755 cents.”

AWEX said although the total amount of bales offered so far this season continues to track above the previous, the total dollar amount of wool sold is well down.

“The A$47.64 million sold this week, pushed the season to date total to $1,479 million.

“This is $146 million dollars less than last season, with more wool sold.”

New wool contracts helped auction competition – AWI

Australian Wool Innovation trade consultant Scott Carmody said better enquiry since the close of selling the previous week and through the weekend was converted to some welcome fresh business for exporters, but volumes booked firm were reported to be on the lowish side.

“Most of these new contracts originated from the Chinese customers.

“Following the immediate price gains at auction, that enquiry went cold once more as our overseas wool users saw no solid lead or need to follow the spot market price up to book further quantity,” Mr Carmody said.

“Subsequently, the second and final day of selling saw some price retraction even though the AUD was weakening once more against the major trading currencies which gave the US dollar, Chinese yuan and Euro bidders and buyers a 0.5 to 0.8pc price advantage on the week to week comparison.

“The more robust interest for new wool contracts was again enough to put a generally harder competitive environment into auction rooms and was the catalyst to create small incremental movements upwards in the Australian dollar values of Merino wools on offer,” Mr Carmody said.

“The 19 to 20 micron types were the most well sought of the selection and managed a 15-cent price increase for the week.

“Broader than 20 micron sold barely firm.”

Mr Carmody said the superfine Merino types finer than 18.5 micron were again subjected to a lacklustre demand scenario, despite the high-quality wools from the New England area of New South Wales being available.

“Some of these clips though were purchased by the Italian worsted industry at significant premium prices above the micron price guide quotes, but compelling bidding from some Chinese vertical companies occurred and soaked up many bales that would normally be the domain of sole Italian competition and import.”

Next week, a similar bale quantity is expected. There are currently 41,1154 bales rostered for sale nationally, with again only two selling days required.

Click here to see the latest AWEX Micron Price Guides.

Sources – AWEX, AWI.

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