WOOL prices recovered further at auctions across Australia this week, finishing the 2022 calendar year on a positive note underpinned by strong support for Merino types.
The Australian Wool Exchange said the AWEX Eastern Market Indicator closed out the year 49 cents higher, adding to the previous week’s 54-cent increase.
“The rally over the past fortnight pushed the AWEX-EMI 103 cents higher (+8.4 percent) making it the best performing December on record since 1979,” AWEX said.
“Competition on all lots was fierce from the outset given it was the final chance for exporters to buy at auction until early next year.
“The spirited bidding was maintained throughout the first day, pushing prices continually higher,” AWEX said.
“As with the previous sale many of the highest prices for specific types were recorded late in the day at the Fremantle selling centre.
“Increases of 50 cents was common for many of the Micron Price Guides (MPG’s).”
AWEX said the rally continued into Wednesday where there were further gains of 30 cents a kilogram clean.
“Melbourne sold in isolation on Thursday which was the final selling day of the year.
“The market was more subdued, initially opening in line with the previous day before easing back slightly late in the day,” AWEX said.
“Most pressure was on the lower spec types, while the more stylish types maintained good support through to the close.
“Merino skirtings also found good support during the week and rose over all three selling days.”
AWEX said the crossbreds sold at similar levels to the previous sale with the finer microns (25/26) recording rises of 20 to 30 cents. Merino cardings firmed slightly.
“The offering was just under 48,000 bales for the series making it the fourth largest for the 2022/23 season.
“The market now heads into the annual three-week Christmas recess,” AWEX said.
Sales will resume in Week 28 which is the week beginning Monday the 9th of January.
Prices need to go higher for wool to be competitive – AWI
Australian Wool Innovation trade consultant Scott Carmody said more relevant than the AUD103-cent over the last two weeks was the US84-cent of 10.2pc gain on the demand in US-EMI in that time.
“Even more impressive has been the Western Market Indicator (WMI) that is almost solely Merino based.
“The WMI USD price has shot 10.5pc higher in just the past fortnight.”
Mr Carmody said the strong demand that emerged the last few weeks for mainly Merino fleece and skirting wools stayed the course almost till the final day of selling this week.
“The final day saw just a slight softening in prices at the standalone Melbourne sale as exporters filled forward contracts and indent orders completed their FCL (full container loads, 111bales) quantities.
“There was disparity in gains between centres and individual micron prices, but by week’s end, the three centres public quotations were the most evenly aligned seen for quite some time,” he said.
Mr Carmody said while the price gains are very much a good result thus far, the rises are coming off a low base, compared to and considering the prices achieved through the 2017 to 2020 years.
“Competing land use is stronger than ever at present for property owners, with many alternative enterprises being available.
“Wool prices simply must continue to recover value for wool growing to compete against these other options as floods, droughts and bushfires impact heavily at times across Australia,” he said.
Click here for the latest AWEX Micron Price Guides.
Sources – AWEX, AWI.