Australian wool auctions were heavily influenced this week by the movements in the foreign exchange rates. All the local price indicators moved strongly to the positive as supply for the week was lower than expected and some solid enquiry was emanating from not just overseas but from the many attendants at the highly successful International Wool Textile Organisation (IWTO) congress held in Adelaide this week.

The Australian dollar (AUD) charted to levels up to 2% lower against the US dollar (USD) under assumptions and commentary from the USA that interest rates in that nation would remain at similar levels for the foreseeable future. This put upward pressure on the local market price being paid in AUD, but demand was still firmly sitting at the static levels being witnessed for the past few months.

Sale offerings for varied reasons dropped by 13% from the expected volume and this helped the bales that were eventually offered sell to advantage. Sellers were keen to offload their production with subsequent clearance rates of 96.6% being one of the highest seen for quite some time.

The largest Chinese top maker was the greatest influence on the Merino sector this week by taking over 18% of the total offered volume. Australia’s largest two trading houses were strongly supporting, but by no means were they forcing the price. All other parties were interested and active, but just could not compete for the bales at the level at which prices were eventually settling at. The purchasing activity and intent of that giant top maker did appear to give others more confidence though. 

Merino prices at the finest end of the micron spectrum saw the best gains take place, with 30 to 50ac being added for super fine wool finer than 18.5 microns. The finer the lot, the more c/kg were gained. The 19-to-22-micron wools were by no means missing out and 15 to 20ac gains were made on those wools. Crossbreds were 10ac dearer and cardings 5ac dearer. 

Next week has 44,000 bales rostered to sell Tues/Wed.