AUSTRALIAN wool growers and brokers reacted strongly to the dramatic market correction this week, passing in 14 percent of the auction offering.

Following the dramatic price rises experienced at the previous sale, Merino wools lost 30-50 cents this week, dropping the AWEX Eastern Market Indicator 42 cents to 1572c/kg clean.

Brokers passed in 14pc of the 37,598 bale offering. The EMI in US dollars fell US40 cents to US1240c/kg.

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AWEX senior market analyst Lionel Plunkett said there was an unusual selling pattern this week, with only Sydney and Melbourne offering on Tuesday and Wednesday, due to Fremantle having a one-week recess and to accommodate Wool Week activities scheduled for Thursday.

“The tone of the market was again set from the opening lot, prices were quickly and heavily discounted.

“Generally, most types and descriptions across the entire merino spectrum traded at levels 30 to 50 cents below those achieved at the previous sale,” he said.

“The lesser style lots and lots with unfavourable length and strength results were the hardest hit in the falling market.

“On the first day the benchmark Eastern Market Indicator (EMI) lost 24 of the 64 cents it gained last week.”

On the second day, Mr Plunkett said there were further losses, but not quite as severe as those seen on the previous day.

“Generally, most types and descriptions fell by 10 to 30 cents, pushing the EMI down a further 18 cents.

“The EMI closed at 1572 cents, an overall loss of 42 cents for the week, the largest fall in over 4 months.”

Mr Plunkett said the only real shining light for the week, was stylish superfine wool (17 micron and finer) exhibiting excellent additional measurements, which sold at levels very close to those achieved at the previous sale.

“The skirting market again closely mirrored the fleece, prices were discounted from the outset, with most types and descriptions generally easing by 20 to 40 cents.

“Skirtings carrying more than 3pc vegetable matter content suffered the largest falls.”

Mr Plunkett said the crossbred sector also recorded losses, but not to the same extent as the Merinos.

‘The reduction in price was felt across the board, all microns eased by 10 to 30 cents for the sale.”

There are currently 44,750 bales rostered for sale in the three selling centres next week.

Click here to see the latest AWEX Micron Price Guides.

Source: AWEX.