Wool price rise prompts more growers to sell

Sheep Central, October 9, 2020

MORE Australian wool growers sold clips this week as prices improved across all Merino and crossbred categories.

AWEX senior market analyst Lionel Plunkett said after falling last week for the first time in a month, the Australian wool market has bounced back, with the benchmark Eastern Market Indicator rising 22 cents to 1022c/kg clean.

The passed-in rate of 5.1 percent for the 29,668 bales offered was under a third of the 17.8pc rate of last week.

Mr Plunkett said the national offering increased by 1354 bales, but the total offering compared to the previous season continued to fall.

“This year there has been 8030 fewer bales put through the auction system, a reduction of 2.2pc.”

Mr Plunkett said the largest price rises were felt in the finer microns.

“The individual Micron Price Guides (MPGs) for 19 micron and finer gained between 20 and 55 cents nationally.

“19.5 micron and coarser still enjoyed solid rises and in this range the MPGs rose by 19 to 35 cents.”

The AWEX EMI in US$ rose 2.7pc or US19 cents to US727c/kg clean.

“The EMI has now risen for four out of the last five selling series, gaining a total of 164 cents over this period,” Mr Plunkett said.

He said the skirting market again followed the lead of the Merino fleece, recording solid increases across all microns and descriptions, generally between 30 and 50 cents, with the 18 micron and finer most affected.

“All crossbred MPGs posted rises for the series, of between 15 and 30 cents.

The 30-cent increases were for the 30 micron MPG in the south, which was the largest movement of the series (7.5pc).

Buyer expectations thwarted by demand

Australian Wool Innovation trade consultant Scott Carmody said buyer expectations were for a largely unchanged to cheaper prices at the start of the week, but these evaporated as auctions commenced.

“Sale room operators initially gauged each other’s intention and quickly realized the buying intent being represented was far better than the soft market predictions.

“Many stepped up their own purchasing rates, forcing prices steadily higher,” he said.

Mr Carmody said Merino fleece finer than 19 micron came under the most buying pressure and was not restricted in quality.

“In fact, much of the offering that is usually discounted such as overlong or low tensile strength sale lots sold at market rates almost equivalent to the better European specification types.

“The Merino fleece broader than 19 micron was by no means neglected by pushing 20 to 30 cents higher, but competition was not as fierce in that sector.”

Mr Carmody said top makers were very interested in the skirtings and crossbred wool offered, while processors led the modest gain that was extracted for cardings.

“Repeating the buying pattern that has developed over the past few sales, trader interest continued to dominate the Merino fleece sector, while first stage manufacturer representatives topped buyers lists on all other types and descriptions.

“The majority of enquiry and firm interest is emanating out of China, but small pockets of activity from the sub-continent and Europe are evident in the market locally.”

Next week’s national offering increases slightly to 30,468 bales. Sydney and Melbourne will be in operation over both days, with Sydney a designated superfine sale.  Fremantle only requires one day of selling, on Wednesday.

Click here for the latest AWEX Micron Price Guides.

Sources: AWEX, AWI.


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