FINE wool prices increased mostly in Sydney and Melbourne auctions this week, but the market generally recorded an overall loss.

The Australian Wool Exchange said this was the third consecutive week of an overall market drop.

Brokers offered 27,667 bales nationally, 725 bales fewer than the previous sales, and 8.3 percent were passed in.

“On day one in the east, the Merino fleece Micron Price Guides movements ranged between minus 23 and plus 16 cents.

“The benchmark Eastern Market Indicator (EMI) dropped by 2 cents,” AWEX said.

“In a very similar result to the previous week, in Fremantle the losses were generally more substantial, as Fremantle did not suffer the falls seen in the eastern centres on the second day last week.

“Here the MPGs lost between 9 and 16 cents, the only exception was the 18.5 MPG which gained 5 cents.”

AWEX said the western indicator dropped 6 cents, a larger fall prevented by a very strong carding market.

“On day two, the market had varied results, which was reflected in the movements in the Merino fleece MPGS, which ranged between plus 24 and minus 36 cents.

“The EMI dropped another 10 cents, closing the week at 1845 cents/kg clean.”

AWEX said although the EMI is trending lower for the season, it is still well above the start of the calendar year.

“The EMI opened this season at 1909 cents and has since lost 64 cents, a drop of 3.4pc.

“The EMI opened the calendar year at 1541 cents and has added 304 cents across this year so far, an increase of 19.7pc.”

AWEX said compared to the corresponding sale of the previous season, the EMI has risen by 392 cents, an increase of 27pc.

“The carding market defied the trend of the other sectors, recording healthy gains, driven by sharp increases on Merino locks, which attracted strong demand.

“The three carding indicators rose by an average of 31 cents.”

Next week’s offering is forecast to increase. There is currently expected to be 31,886 bales on offer nationally.

Caution continues in wool market – AWI

Australian Wool Innovation said in the first auctions after the Nanjing Wool Market Conference in China, fine, well-specified wool continued to outperform broader or poorer-style descriptions, with strong competition on 18.5 micron and finer better-style and better-specified wool. Poorer specified and 19 micron and broader descriptions generally eased.

“Traders were again the main competition, although Chinese processor support became noticeably stronger through the second day.

“European buyers were also prominent on superfine types,” AWI said.

“The carding sector was the standout, with strong demand for Merino locks lifting the three regional carding indicators by an average 31 cents.”

AWI said the national passed-in rate for the week indicated that grower price expectations were selective rather than broad-based.

“This suggests some sellers continued to hold wool above prevailing market levels, particularly where reserve expectations remained anchored to recent higher prices.”

AWI said this week highlights that caution remains, although the increased presence of Chinese processors later in the sale provides some evidence of underlying demand returning at selected price and quality levels.

“With the Week 14 offering forecast to rise to around 31,886 bales, the larger catalogue will provide another test of post-Nanjing buying appetite.”

Sources – AWEX, AWI.