LOWER supply, a weaker Australian currency and improved overseas demand lifted the Australian wool auction market this week.
The Australian Wool Exchange said auction market bounced back from the losses experienced last week.
The national bale offering dropped by 16,256 bales to 33,436 bales this week, and brokers passed in 5.9 percent.
“Compared to the previous season, the total amount offered this season continues to trend lower.
“There have been 885,488 bales put through the auction system season to date, this is 179,321 fewer bales than the previous season, a fall of 16.8 percent,” AWEX said.
“The first day of selling, results were mixed across microns and the three selling centres.
“The movements in the individual Micron Price Guides for Merino fleece ranged between plus 11 and minus 29 cents and the benchmark AWEX Eastern Market Indicator posted a two-cent rise.”
AWEX said the second selling day was more positive, with no negative results in the Merino fleece MPGs and the movements ranged between unchanged and plus-19 cents.
The EMI added another 4 cents and finished the week 6 cents higher at 1192c/kg clean.
“The market has made a positive start to the 2025 calendar year.
“In the six selling days of this year, the EMI has only fallen on only one occasion (a 4-cent fall on the 21st of January) and is currently trading 38 cents higher than its 2025 opening level,” AWEX said.
“In USD terms, the EMI has also recorded just one negative result, rising four out of the six selling days, with one unchanged result.
“The EMI has added 12 US cents across these sales.”
AWEX said the crossbred sector performed strongly this week, with all published MPGs recording rises of between 5 and 40 cents.
“These rises contributed to the overall rise in the EMI.”
All parties satisfied – AWI
Australian Wool Innovation trade consultant Scott Carmody said the Sydney and Melbourne auctions operated under a very competitive environment, despite the absence of a few of the usual Chinese buyers from sale rooms.
“This positivity advanced general price levels upwards of 10c/kg clean higher, with both the Merino and crossbred sectors similarly affected.
“The WA Fremantle market though outperformed their eastern counterparts and doubled the gains of those centres by posting 20c/kg clean gains across their entire offering,” he said.
“Buyers were greeted with lower auction volumes this week as sellers saw no advantage in loading volume into a sale week that had both Monday as an Australian public holiday and Wednesday a sale day off to allow for recognition of the Chinese New Year.
“A weaker Australian dollar forex rate against the major currencies combined with the better enquiry from overseas to allow the market prices to push upwards in local AUD terms, but remain relatively stable in USD and CNY terms,” Mr Carmody said.
“Thus all parties involved in the transfer of ownership this week would have been relatively satisfied by weeks’ end.”
Mr Carmody said the start of the selling week was conducted under a noticeable stability of pricing.
“Most sale room operators were acting to extremely cautious strategies and not letting the small quantity available for sale spook the market.
“Purchasing numbers by the end of the day was very evenly spread amongst the top buyers,” he said.
“The second and final day of selling on Thursday though saw buyers having to push price levels up in order to complete commitments and this is where most of the gains were made for the week.
“In fact, price levels were the highest at the close of selling,” Mr Carmody said.
“Buying was dominated by Australia’s largest trading exporter who ended the week with over 18 percent of the entire offering.
“Not far behind was their fiercest trading competitor at a touch over 14pc,” he said.
“China’s largest top maker buyer remained active in sale rooms and participated.”
Next week’s national offering is expected to increase as sales return to the normal Tuesday/Wednesday selling pattern.
There are currently 38,361 bales on offer in Sydney, Melbourne and Fremantle. Fremantle will sell just on Tuesday as their volumes lighten off over in the west for the time being. Melbourne sees a drop off in comparison to their usual dominant weekly volumes and Sydney has a comparatively larger percentage of bales being offered for the week. Both eastern markets sell Tuesday/Wednesday.
Sources – AWEX, AWI.
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