Turbulent pricing featured throughout Australian wool auctions this week, but by the close of selling, negligible changes had been registered on the week to week comparison. Most wool types and descriptions finished lower but within 5 to 10ac of the established basis. In WA however, most Merino price indicators added 5 to 10ac to the values of last week.

Foreign exchange rates behaved more sedately this week, the exception being the Euro which strengthened against the Australian dollar. Most commodity linked currencies (such as the AUD) weakened 1.5% against the Euro as crude oil prices fell after news of the USA planning to place vast parts of their strategic oil reserves onto the market. Other significant news this week included a larger than expected decrease in Chinese manufacturing activity. 

The Eastern Market Indicator (EMI) dropped by 0.6% or 9ac to close at 1375 ac/clean kg. In USD terms the EMI was 5usc lower and concluded the selling week at 1029 usc/clean kg. Despite the gains on most of the individual Merino micron price guides in Fremantle, the Western Market Indicator (WMI) still dropped 6ac to 1418 ac/clean kg. Nationally, 86.9% of all wool offered managed to find a buyer.

The first day of auctions this week produced negative price results across the type spectrum. Losses of up to 40ac occurred as buyers cautiously and carefully approached purchasing as they quickly identified that local traders would be bearing the brunt of financing this week’s auction transaction costs. 

The off-shore based buyers started the week off abnormally quiet, with the exception of the crossbred wool type purchasing indent from China. With local buyers being willing to keep on buying early in the week, the final two days saw offshore interests first stabilise the market then inevitably push prices up to finish the week positively.

Next week’s Australian auctions will be operating over two days of Tuesday and Wednesday. Currently just under 50,000 bales is available to the trade.