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Wool market favours cleaner Merino fleece lines

Sheep Central, March 18, 2022

MERINO fleece with low vegetable matter content was least affected by a slight drop in the Australian wool market this week.

The Australian Wool Exchange said the fleece market was a “tale of two types” as vegetable matter (vm) levels played a significant role in the prices that were achieved.

“Good style wools carrying less than 1.5 percent vm were limited in supply and highly sought after, wools carrying less than 1pc vm even more so.

“The strong buyer interest in these lots kept prices generally within 20 cents of the closing levels of the previous series,” AWEX said.

“The opposite was true of the abundance of higher vm lots available, with only 40.7pc of the total fleece offering having less than 1pc vm content.

“These higher vm wools lacked buyer support, continually losing ground as the sales progressed,” AWEX said.

“The waning interest in these types generally pushed prices down by 30 to 50 cents for the week and was a major contributor to the 13.7pc of the fleece that was passed in.”

The AWEX Eastern Market Indicator (EMI) dropped by 5 cents this week, closing at 1408 cents/kg clean.

“The EMI has had an up and down run since Week 33.

“Since that time, the EMI has risen on all even numbered weeks (for a gain of 7 cents) and fallen on the odd numbered weeks (for a loss of 19 cents),” AWEX said.

“The EMI is still 131 cents higher than the corresponding sale of last season.”

AWEX said the national offering was more than 2000 bales smaller than last week, due in part to Melbourne again being limited to two selling days, to accommodate a Monday Public Holiday. There were 47,251 bales available to the trade and 11.9 percent were passed-in.

Merino types hold in the east – AWI

Australian Wool innovation trade consultant Scott Carmody said Merino types generally held in eastern markets, but in Western Australia those levels deteriorated by 15 to 20 cents on the final day.

“Additionally the small rally that had appeared the past few weeks on the crossbred wool descriptions appeared to hit a road block for the time being and prices had fallen by 20 cents by the conclusion of the selling week.”

He said passed-in rates remained similar, but trended toward a higher retention by sellers.

“Around 88pc of all wool offered was cleared to the trade nationally although that rate dropped significantly in Fremantle whereby just 78.2pc of wool offered met the grower seller expectations.

“Another stand out figure was that 23.5pc of crossbred wool types offered in Sydney failed to sell,” he said.

Mr Carmody said the Western Market Indicator (WMI) fared comparatively worse than the EMI as the later Fremantle sale occurred when the Australian dollar was at its strongest point for the week. “The WMI subsequently fell away 11 cents to 1446 c/clean kg.

“In US$ terms, the EMI fell US4 cents to a closing basis of US1030c/kg clean.”

Mr Carmody said despite the much reported logistics issues plaguing all industry supply chains globally and the negative effects emerging from COVID lockdowns in China again, the Merino wool markets are resolutely holding on.

“This is indicative of reasonable to good demand at least.

“Those Merino types are very much being helped by consistent purchasing emanating from European and Indian interests, particularly on the FNF (1pc vm average) types,” he said.

“What is not helping though is the staggeringly long steam time for delivery to those non-China destinations, which some report at being up to four months from the time of booking contracts to delivery processed.

“This is almost double the duration of what the “normal” supply chain for wool textiles used to operate to just a few years back.”

Next week’s sales return to the normal Tues/Wed selling pattern, with Melbourne able to conduct a third selling day (Thursday), which has in turn pushed the national offering higher. 48,286 bales are currently expected to be offered in Sydney, Melbourne and Fremantle.

Sources – AWEX, AWI.

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  1. Andrew Farran, March 19, 2022

    The ‘revised’ National Wool Declaration is ambiguous and defies clarity (see below).
    Treatment with liquid nitrogen is not mulesing. The category described as Non-Mulesed mixes issues that semantically cannot be mixed. So there is an ulterior motive here. Why not admit to that being the case instead of engaging yet again in pulling wool over our eyes?
    Come clean please.

    NATIONAL WOOL DECLARATION (NWD)
    AWEX announced the release of Version 9.3 of the National Wool Declaration on Thursday evening.
    The details are as follows:
    Key Dates
    * It will come into effect on 25 July 2022
    * A full Review will commence in 2023, with a scheduled implementation date of July 2024.
    Mulesing Status Definitions Non Mulesed (NM)
    * No sheep in this mob have been mulesed or
    treated with liquid nitrogen.
    Liquid Nitrogen (LN)
    * Sheep in this mob have been treated with liquid nitrogen.
    Analgesic and/or Anaesthetic (AA)
    * Sheep in this mob have been mulesed with the use of an analgesic and/or anaesthetic product registered by APVMA.
    Mulesed (M)
    * Sheep in this mob have been mulesed without the use of an analgesic and/or anaesthetic product registered by APVMA.
    Ceased Mulesing (CM)
    * No lambs born on this property in the last 12 months have been mulesed.
    * No mulesed (or AA) ewes or wethers have been purchased in the last 12 months.
    Changes to Version 9.3
    The approved key changes to the NWD V9.3 are:
    * NM definition refers to the exclusion of liquid
    nitrogen.
    * Introduction of Liquid Nitrogen (LN) for sheep treated with liquid nitrogen,
    * LN mobs to be identified separately from NM, AA, M, ND mobs,
    * CM has been retained,
    * Both questions related to Ceased Mulesing (CM) Status now have a 12 month time frame; and
    * NM and LN clips may be eligible for CM, where NM or LN is used on the youngest mobs.

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