MORE Australian wool growers held back bales from sale this week as buyers collectively pulled auction market prices back.

In a now often repeating pattern of an increased bale offering – 29,406 bales, 1739 more – being associated with lower bids and leading to a higher passed-in rate – 12.8 percent, up 4.5pc – the Australian Wool Exchange said the market had its fourth consecutive overall weekly loss.

AWEX said in the season to date there has been a total of 309,525 bales offered, 31,703 bales fewer than the previous season, a 9.1pc drop.

“On day one in the east, the Merino fleece Micron Price Guides (MPGs) fell by between 6 and 66 cents.

“The benchmark Eastern Market Indicator (EMI) dropped by 21 cents/kg clean,” AWEX said.

“In Fremantle, the losses were larger, as again the western region did not experience the falls seen in the east on the second day of the series last week, particularly in the medium/broad microns.

“In the west, the MPGs lost between 9 and 104 cents.”

AWEX said despite losing 104 cents for the day, the 21 MPG is still trading 31 cents above the southern MPG.

“The western indicator dropped by 44 cents.”

AWEX said on day two, just Sydney and Melbourne were in operation and the market behaved in varied ways.

“In Sydney, the MPGs ranged between plus 28 and minus 40 cents.

“While in Melbourne, the movements were minimal.”

AWEX said the southern MPG movements for Merino fleece ranged between minus 7 and plus 3 cents and the EMI dropped by 5 cents for the day.

“This was the seventh consecutive day the EMI has fallen, losing a total of 74 cents across this run, a 3.9pc reduction.

“The EMI ended the week 26 cents lower at 1819 cents/kg clean.”

Due to currency movement, in USD terms the losses were larger and the EMI fell by US42 cents.

“The lower prices on offer pushed the passed in rate to 12.8pc, as many sellers were reluctant to accept the lower prices on offer.”

Next week’s offering is forecast to be of a similar size. There is currently expected to be 29,561 bales on offer nationally.

Seller resistance increasingly important – AWI

Australian Wool Information said the Australian wool market continued to fall this week as buyers remained selective, and growers showed increasing resistance to lower prices.

AWI said quality differentiation by buyers remained pronounced, with Sydney experiencing strong competition for the best-style and better-specified 19-micron and finer wool.

“Italian and Indian interests were active on preferred lots, while 18-18.5 micron held comparatively firm.

“Poorer style and specification wool, particularly 19.5 micron and broader, continued to lose ground.”

AWI said seller resistance became an increasingly important feature of the sale, as the national pass-in rate reached 12.8pc.

“This resistance was further evidenced across the Merino sector with fleece pass-ins reaching 16.8pc in Melbourne and 20pc in Fremantle.”

AWI said despite recent weakness, market fundamentals remain robust – characterised by the fact that while season-to-date offering is 9.1pc below last year, turnover is $92 million higher at $594 million.

“For growers this reinforces the value of presenting well-prepared wool into a market where buyers are competing for limited supply.”

With around 29,561 bales forecast for Week 15, the market will again test whether reduced supply and seller resistance can stabilise prices against continued buyer selectivity, AWI said.

Sources – AWEX, AWI.