News

Wool market builds on last week’s lift in demand

Sheep Central, September 11, 2019

AUSTRALIA’S wool auction market has rebounded early this week after positive signs of recovery on the AuctionPlus’ online wool marketing platform late last week.

AWEX’s early market reports have described the southern indicator lifting 93 cents , with a limited offering of 17.5 micron and finer wools remain fully firm and the 18-18.5 micron fleece up by 50-60 cents. The broader microns, 19-21 micron, has jumped rapidly upward by 150 cents. Merino skirtings and crossbred fleece is also up by 80-100 cents.

AWEX’s interim northern market report has the indicator lifting 78 cents, with 18.5 micron and broader wools adding 80-100 cents across all types and descriptions. The finer microns are generally 40-60 cents dearer, with an offering of 17 micron and finer wools less affected. Merino skirtings, crossbred fleece and oddments were also selling dearer.

These early positive reports this week follow AuctionsPlus selling 462 bales sell between Thursday and Sunday last week.

AuctionsPlus technical operations officer Matt Cotton said the benchmark AWEX Eastern Market Indicator last week had continued its downward trajectory to hit 1365c/kg clean, down 10 cents, although in US$ terms the EMI lifted US6 cents to 931 cents.

With just 21,694 bales offered, the passed-in rate fell back to 11.5pc, down from the previous week’s 33.4pc.

“While the lower supply had an impact on passed in rates, it is yet to have any significant impact on prices.”

He said optimism returned to the wider economy last week, with the ASX200 Index closing on Friday up 34.1 points in response to easing trade tensions between the US and China.

“This helped wool prices find support at current levels, and stopped the dramatic price drops seen in previous week.”

Mr Cotton said 17 micron wool sold to an average of 848c/kg greasy or 1437c/kg clean on AuctionsPlus last week, with a top of 1248c/kg greasy or 1803c/kg clean. A line of 18 micron wool sold for 1070c/kg greasy or 1592c/kg clean.

The top-priced lot sold online last week was a three-bale line of 17.5 micron AAAM Merino fleece wool with 0.9pc vegetable matter. The lot was branded KS/TEM, was listed by Moses and Son and sold for 1281c/kg greasy or 1792c/kg clean.

“Looking forward, 27,923 bales are currently on offer for this week, up 6000 on last week.

“Growers may look to withdraw wool if prices are not at desired levels, but may also need to secure cash in this current economic environment,” he said.

“It has been reported that Chinese mills are moving back into the market, which may have a positive impact in the coming weeks.”

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