Online wool sales slump with buyer reluctance then lift this week

Sheep Central, April 9, 2019

ONLINE wool sales suffered last week, as the market was affected by the quantities of drought-affected wool in auction offerings.

However, online sales early this week might indicate a change in buying sentiment, AuctionsPlus regional sales associate Ed Murphy said.

Mr Murphy said some of the buyer reluctance shown in the physical auction market’s slight decline last week has been attributed to the quality of wool on offer.

He said there has been a large amount of wool of low tensile strength and high vegetable matter content as the current seasonal conditions across most of Australia continue to have an effect.

“Some relief has come for New South Wale’s central west and north west regions, and parts of Queensland, with rainfall across these areas, although decent follow-up rain is needed given the length of dry to provide a break.”

He said reports from physical auctions suggested buying at the start of selling in Melbourne was slow, but picked up as many buyers are seeking quantity given the reported supply pressures.

“This momentum reportedly held solid on the second day, although large quantities of drought-affected wool are still being discounted.

“This is backed up by the AWEX Eastern Market Indicator falling three cents on Wednesday and then a further cent on Thursday to reach 1943c/kg clean.

“The largest gains came for 25-30 micron wools, as demand for crossbred wool types was firm, while Merino wool indicators had mixed results across the three selling centres,” he said.

“This sentiment at physical auction was reflected online as AuctionsPlus wool sold only 22 bales last week.”

The top price online was 1435c/kg greasy or 2239c/kg clean for a 10-bale line of 19.1 micron Merino fleece. This line yielded 64.1 percent, with an average staple length of 82mm, a tensile strength of 32 Newtons/kilotex and 2.9pc vegetable matter content.

“Given the surge in demand for crossbred fleece, activity online was relatively quiet this week with only two of the bales sold online being crossbred,” Mr Murphy said.

The top crossbred line sold on AuctionsPlus was a two-bale lot of 25.2 micron weaner fleece with a yield of 77.2pc and 2.7pc vm that made 1000c/kg greasy or 1295c/kg clean.

“This week, the supply remains steady based on previous weeks with 38,700 bales on offer,” Mr Murphy said.

“With supply pressures, it is expected the market will continue along the same path as the last couple of weeks, although with 33 bales sold as of Tuesday morning (today) online, early buying activity online may suggest a change in sentiment at physical auction this week.”


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