A much more sedate market atmosphere greeted participants at this week’s Australian wool auctions.  It appeared though that the impetus of strengthening wool prices from the healthy prompt demand-driven scenario of  the past few weeks has stalled for the time being. Foreign exchange rate movements for the week all went to the favour of local AUD values and a small average wool price gain was subsequently managed. 

The usually positive price movements caused by lower than normal supply being available (WA did not sell this week) failed to materialize in general, but the Merino wool types broader than 19micron did post robust gains of up to 40ac clean/kg  This is the wool type area Western Australia contributes strongly to nationally by volume. Conversely the finer than 19 micron Merino wools, most skirtings and crossbreds on offer showed losses in value of between 5 and 30AC. Carding types were largely unchanged.

The Eastern Market Indicator (EMI) gained a further 7ac this week to extend the run to a season-high level of 1474ac/clean kg.  When viewed in other currencies wool prices were all showing negative results. The USD EMI fell 7usc for the week to 1020usc/clean kg. Given the low volumes and overall strong market, the clearance rate was underwhelming at 89.1% of all wool offered being sold.

Auction purchasing saw the first stage manufacturers again being outgunned by local and Chinese traders and also Chinese indent operators. Australia’s largest and most influential trading house and one strong indent buying operation for Chinese delivery almost solely led the spot market price setting. In particular, strong interest for all types and descriptions as 19 to 22 micron dominated the price gains for the week.  

The quality of the offering is on the improve. Many of the districts that have been affected by prolonged wet weather and problematic feed conditions in paddocks appear to producing much better wool types and in more volume. VM (vegetable matter) remains relatively higher, but colour, strength and yields of the freshly shorn clips are of good character. Next week’s sales sees a return to the three selling centres in operation with 45,000 bales on offer