Australian wool auctions prices faltered at points throughout this week, but held on remarkably well despite some potentially negative influences. Whilst it is never good to see any loss in wool values, many trade participants from both sides had commentary centred on the resilience of the price amidst the seemingly tougher demand scenarios currently at play. 

The Eastern Market Indicator (EMI) closed the week 1% or 13ac lower to close at 1306ac clean/kg. The USD EMI deflation was similar at 1.2% or 12usc to settle at 1007usc/clean kg. Since the COVID-induced low point of September 2020, the AUD EMI has bounced back 52.4% from the bottom of 857ac. In USD that recovery has been even greater due to the strengthening AUD over the period and has seen a 59.6% regain from 631usc.

The cautious approach to the week from buyers arose from trepidation that the un-seasonally large quantities being offered could struggle to be absorbed, given the detrimental foreign exchange (forex) rates available and the tight access to finance being managed. Additionally the current selection is extremely diverse, with many lots in the harder-to-place wool type categories, predominantly due to the heavier vegetable matter at present. 

The large quantity of around 50,000 bales combined with the AUD:USD forex rates (over .785 as selling was underway for the first two days), held market prospects in check for the week. Grower sellers subsequently passed in 12% and the forex plummeted 2.1% overnight Wednesday. These actions cumulatively assisted in the taming of the negativity to some degree and seeing the market post small gains at the close of selling at both Fremantle on Wednesday and the Thursday Melbourne-only sale.

In a week that saw wool prices defying expectations again, it was Chinese interests that continued to provide demand. Chinese top makers, processors and traders were all active. Limited competition came from Italy for the few better superfine clips and some stronger European top maker purchasing was evident. Small pockets of Indian buying was also observed.

46,000 bales is being offered next week.