Despite continued support for good style, length and strength wools, AWEX senior market analyst Lionel Plunkett said the AWEX-EMI eased eight cents to 1036c/kg this week on the back of a recent spike in auction volumes.
The EMI in US cents fell another 10 cents to 907 cents, as the Australian dollar fell to US87.58 cents.
Biggest offering since January expected next week
Mr Plunkett said just over 46,000 bales were offered in Fremantle, Yennora and Melbourne this week — less than the expected total of 48,824. An offering of 53,101 bales is expected next week, the largest offering since January.
“When combined with last week and next week, this will result in a total of almost 148,000 bales offered over the three-weeks — a 12.6 percent increase on the corresponding period from last season,” he said.
Mr Plunkett said totals for this season to date are slightly lower than last season, which was expected given the forecast 3.8pc reduction in wool production by the Australian Wool Production Forecasting Committee.
Growers reacted to the state of the market this week with pass-in rates for Merino fleece reaching 16.2pc in Melbourne and 15.9pc in Fremantle. Oddment pass-in rates were 9.9pc in Fremantle and 11.2pc in Melbourne.
Market opened on positive note
Mr Plunkett said price-wise the sale series opened on a positive note when a stylish NZ catalogue attracted good support on Tuesday.
“Although difficult to compare, prices were ahead of the Australian offering from the previous week. “The following two days saw prices deteriorate however,” he said.
“There was irregular support between the auction centres depending on the sale-day, but at the close any regional differences tended to dissipate.”
Mr Plunkett said the broader microns lost the most ground and fell 15-20 cents for the week, while the finer categories were generally 5-10 cents lower.
“The better types continued to attract good support and finished in line with the previous sale due to a strong final day,” he said
“Merino skirtings will often follow the trend of the lower-spec fleece types as they can have similar processing characteristics.
“This week was no exception with pieces and bellies as much as 20 cents cheaper.”
Mr Plunkett said crossbred wools recovered some lost ground on the final day to close a modest 5 cents cheaper for the sale. The Merino carding indicators firmed slightly for the week.
19.5 micron wools suffer the most in Sydney
Landmark wool risk manager Anthony Boatman said fine wools in Sydney eased a few cents generally on Wednesday’s opening sale, however there was good support for the low mid-break, best and spinner style lots.
“Medium micron categories were softer, with most categories losing 5 cents.
“The 19.5 micron categories were most affected by the poor demand for lower spec wools, recording a 12 cent decline,” he said.
“Crossbred fleece also lost ground despite the good bidding on forward markets prior to the sale.”
Mr Boatman said oddments held their ground, lifting slightly.
Heavy discounting for out of spec lots continued on Thursday, however fine wools managed to maintain support, closing unchanged to 5 cents cheaper, he said.
“Medium micron categories were pushed down another 10-15 cents under the weight of high mid‐break wools, with even good strength lots of 40 Newtons/kilotex discounted.
“Crossbreds sold little changed, as did the oddments categories.”
Melbourne prices improve on second day
Mr Boatman said Wednesday’s sale opened poorly in Melbourne, with prices for the medium to broad wools initially 20 cents under last week’s closing levels.
“Prices improved as trade progressed through the day, and levels crept back to close the day just 5-10 cents lower.
“Fine wools were also 5-10 cents lower, although there was good buyer support for the limited offering of Tasmanian sourced wool, which was good strength and low mid-break.”
Mr Boatman said crossbred wools also suffered, with losses in the range of 5-15 cents, while oddments lifted a few cents higher.
On Thursday, the market was more positive, particularly for the finer end, with improvement for all types, not just the better style and strength lots, he said.
“Prices increased by around 5 cents for the 19 micron and finer wools.
“Coarser categories were quoted soft to unchanged, although generally movement was restricted to only a few cents.”
Mr Boatman said crossbred wool improved, clawing back some of the previous days losses, while oddments handed back the previous day’s gains.
18-20 micron wools hold firm in Fremantle
Prices for the 18 to 20 micron categories on offer in Fremantle were very little changed during Wednesday, with movements of up and down by only a cent.
Mr Boatman said the 21 and 22 micron categories made the largest losses of 5 cents and 8 cents, despite the market improving towards the end of the day. Oddments closed up 5-10 cents, he said.
On Thursday, the finer micron categories remained unchanged, ranging from 4 cents lower to 3 cents higher, while the 20-22 micron categories eased off another 5-10 cents, he said.
Oddments were mixed, with locks easing and crutchings firmer, resulting in a 2 cent loss to the Merino carding indicator.
Sources: AWEX, Landmark.