CROSSBRED wool values improved at auctions across Australia this week, but lower prices in most Merino fleece categories dragged the overall market back.

The Australian Wool Exchange said a strengthening Australian dollar weighed heavily on the Australian wool market this week, contributing to an 11-cent loss in the benchmark AWEX-Easter Market Indicator.

“The benchmark indicator had been threatening to breach 1900 cents/kg clean, but ultimately closed the two-day series at 1886 cents/kg,” AWEX said.

“The AUD rose on the back of a lift in the official cash rate, pushing it through US72 cents for the first time since 2022.”

AWEX said bale volumes continue to be constrained with only 33,055 bales offered nationally, 4689 fewer, including a one-day Fremantle sale. Brokers passed-in 7.3pc of bales offered. On the opening day, all three centres were in operation.

“Main buyer attention continued to focus on the good/best style types, carrying less than 1 percent vegetable matter content (vm), particularly those with favourable additional measurement results,” AWEX said.

“As these lots were in short supply they performed best in what was an erratic market, with positive and negative movements across the Merino fleece range.

“By the end of the day, the Micron Price Guides (MPGs) for Merino fleece ranged between plus 30 and minus 29 cents.”

AWEX said stronger crossbred and oddment markets helped to minimise the damage to benchmark Eastern Market Indicator (EMI) which fell by the barest of margins.

“On the second day, it was just Sydney and Melbourne selling and prices continued to deteriorate.

“In the Merino fleece, MPGs the movements ranged between unchanged and minus 26 cents.”

In a repeat of the previous day, AWEX said a strengthening in the crossbred and oddment sectors prevented the EMI from falling more than it did, with the EMI dropping by 10 cents.

“Due to the strengthening of the AUD, when viewed in US dollar (USD) the market movements were positive.

“The EMI added US6 cents on the first day and US9 cents for the second, closing the series US15 cents higher at US1367 cents/kg clean.”

Bullish tone of market is intact – AWI

Australian Wool Innovation said that although the EMI fell 11 cents and the Western Market Indicator eased 3 cents, in USD terms the market strengthened, and the underlying bullish tone of the wool market remains intact.

“Rather than reflecting a shift in fundamentals, this week’s correction in AUD returns was primarily foreign exchange-driven, with the market absorbing the headwinds of a stronger Australian dollar and recording only a modest decline in local currency terms.

AWI said what was notable this week was the relative strength of the crossbred and oddments sectors.

“This may reflect increased demand for blended fibre applications and woollen spinning inputs as processors seek lower-cost raw materials amid ongoing macro uncertainty.

“The resilience of these sectors contrasted with continued weakness across lower-style Merino fleece types, reinforcing that buyer competition remains selective, with processors continuing to prioritise fibre specifications that deliver greater processing efficiency and consistency as manufacturing margins remain under pressure,” AWI said.

Next week’s offering is forecast to fall again slightly. There is expected to be 31,329 bales on offer in Sydney, Melbourne and Fremantle.

Sources – AWEX, AWI.