Prices at this week’s Australian wool auctions all lowered with the effects of the forex (foreign exchange) rates the predominant price making factor. The Australian dollar (AUD)  strengthened by 1.5% against the US Dollar placing direct downward pressure on the auction prices in AUD. By the end of the trading round, the EMI had lost 2% but the damage to the WMI was more severe at 4.1% and may have been harder hit if sellers in that centre had chosen a different route than passing in 41.9% of the offered volume. 

Whilst demand remains slow and sluggish, outstanding orders to fill from forward book operators helped the sticky market situation with their buying and obviously bought at advantageous rates compared to sold prices throughout the week. China indents appeared specific for type and volume restricted but influenced sale outcomes. The China top makers also made a significant contribution, and they lifted buying rates as prices weakened and they followed the market down. In such a weak market, the top makers were able to acquire much better specifications on sale lots than usual.

The super fine Merino wools - finer than 18.5micron - were again the most in demand types but falls of 20ac to 40ac were still registered. Euro and Indian buyers are still apparent in this area, but their buying has slowed for the time being. More volumes of the better specified super fine lots appeared to be purchased for Chinese orders. The larger percentage losses in the Merino sector were for the wools broader than 18.5micron, the Fremantle centre having losses of around 75ac in this area. In all micron segments, the FNF (less than 1% vm- vegetable matter) lots were far less affected.

Skirting wools sold at similarly lower levels as their fleece counterparts, although the price falls not as large. A general 40/50ac value loss occurred. As with the fleece the lower VM level skirting types were more attractive to buyers and as such prices not as affected. Cardings were 25ac lower, continuing the soft run of the past few months for this sector and surprisingly the crossbred wools were best performing wools by selling at the same, to 5ac lower, than the previous week’s close.

The clearance rates suffered greatly this week, with just over 75% of the offered quantities reaching the buyers hands. Rostered volumes spike to near 49,000bales next week selling on Tues/Wed and Thursday..