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Wool prices settle around quality in national auctions

Sheep Central, March 12, 2021

AUSTRALIA’S national wool auction price benchmark held firm this week, balanced by continued demand for quality and discounting of drought-affected and lower yielding lesser style wools.

The Australian Wool Exchange said the market again posted mixed results across all three selling centres, with another overall week of very little change.

Brokers passed in 9.3 percent of the 46,480-bale offering, that was 64 bales fewer than last week.

“Selling moved to Wednesday/Thursday to accommodate a Monday public holiday in Melbourne and to avoid any centre selling in isolation.

“Only 22.6 percent of the selection was style 4 or better and these types attracted very strong support, and these highly sought after wools generally sold at levels above the previous week.

“In contrast to this, lower yielding lesser style wools, particularly those with higher vegetable matter levels, continually lost ground, as buyers struggled to average them into their purchases,” AWEX said.

“These lesser style wools accounted for a large part of the 9.3pc of wool that was passed in.

“The individual Micron Price Guides (MPGs) for Merino fleece in Sydney and Melbourne recorded movements of between -17 and +18 cents,” AWEX said.

“The Fremantle region, which sold last on both selling days, had the most positive result, and the Western MPGs recorded movements of between 0 and +28 cents.”

The AWEX Eastern Market Indicator fell by the smallest of margins – one cent — closing at 1309c/kg clean.

“In contrast to the often volatile movements in the market this season, the EMI has now traded between 1309 cents and 1318 cents over the past month,” AWEX said.

In US dollar terms, the EMI lost 6 cents to US1014c/kg clean.

Crossbred prices fall in all auctions

Crossbred wool was the only sector to record falls across all regions, with the crossbred MPGs recording movements of between 0 and -38 cents.

“In a similar pattern to the previous series, prices in the carding market increased across all three centres, again the only sector to do so.

“Strong gains in stains, locks and crutchings helped to push the three Merino Carding (MC) indicators up by an average of 19 cents,” AWEX said.

Auction offerings include more faults

AWI trade consultant Scott Carmody said the quality of the freshly shorn offering is moving towards more difficult types for buyers to place, due to faults such as heavy vegetable matter (vm), type of vm and cotted wool growing in number.

“These are all mainly seasonally induced wool faults due to problems surrounding management of the excessive feed in grazing paddocks following the good climactic conditions post drought in most areas.

“Large volumes are still being offered at auction, with assistance from growers now trying to off-load their held wools,” he said.

“Many of these wools are drought-produced, so many lots are restricted in competition due to the tip to base dust penetration causing low yields (less than 55pc dry).

“VM levels are low on these wools, helping to offset high vm available in the fresh shorn sale lots,’ he said.

Mr Carmody said buyers’ lists varied greatly in their representations this week.

“Australia’s largest trading company (TechWool Trading) continued their domination at the top, but some strong competition emerged this week from China’s two largest top makers as both were very active, albeit on separate sale days.

“Chinese indents were involved, but quite often outbid by the aforementioned,” he said.

Next week’s national offering increases, there is currently 53,357 bales on offer in Sydney, Fremantle and Melbourne.

Click here to see the latest AWEX Micron price Guiodes.

Sources: AWEX, AWI.

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