AUSTRALIAN wool growers met the market as wool prices fell further this week, with a slight improvement in rates before the close of the last sales for the 2019/20 season.
Prices fell by up to 105c/kg for fine-medium wool in Western Australia and up to 50c/kg for crossbred fleece as the number of bales offered rose by 12,229 to 28,029.
AWEX senior market analyst Lionel Plunkett said the individual Micron Price Guides (MPGs) in Sydney and Melbourne fell by another 5 to 38 cents.
“Fremantle did not have a sale last week and therefore did not suffer the 40 to 50 cent losses experienced in the eastern markets.
“As a result, the losses in Fremantle this week were much larger, the Western MPGs fell by 82 to 105 cents,” he said.
Mr Plunkett said due to these losses, the AWEX Eastern Market Indicator fell by 29 cents.
“The EMI finished the season on 1110 cents, a fall of 605 cents, which equated to a 35.3 percent reduction for the season,” he said.
“When viewed in US dollar terms the reduction was very similar, a US428-cent fall, 35.8pc lower.”
However, despite the price falls this week, growers seemed more willing to sell and the passed-in rate grew by just 1pc to 11.5pc.
Mr Plunkett said the national passed-in rate finished the season on 17pc and due to the falling prices this was 6.5pc higher than the previous season.
“The total national offering for the season was 1,470,717 bales, which was 194,942 bales less than the previous season, a reduction of 11.7pc.”
He said the total turnover for the year was also well down, which was to be expected with reduced prices and offerings.
“The total turnover for the season was 1.973 billion dollars, compared to 3.192 billion dollars for the 2019/20 season.”
This week, the crossbred sector also recorded price reductions for the series, with the MPGs for 26 through to 32 micron losing 20 to 38 cents for the week in Melbourne. The skirtings followed a similar path to the fleece, with prices generally falling by 30 to 50 cents.
Mr Plunkett said the three carding indicators fell by 38 cents.
Enquiry improved later this week
Fox and Lillie brokerage manager Eamon Timms said prices got slightly dearer on the last day of sales this week and there has been a little bit of inquiry over the past two days, indicating the market might remain around the current level next week.
The buying interest came mainly from China, followed by a small amount of enquiry from India and Europe. Mr Timms said there seemed a greater willingness among growers to accept that the market was unlikely to improve in the short-term.
“We are certainly not seeing any signals that there is going to be reason to think in the short-term that things are going to improve.”
Next week is the first sale on the 2020/21 season. To avoid having a sale straddling two financial years, the sales have been moved to Wednesday and Thursday. There is currently 31,072 bales on offer in Sydney, Melbourne and Fremantle.