Australian wool auction sees prices rise 30% since the recent low of week 10

The Australian wool market experienced another good week with the EMI gaining 30% from week 10, which had hit the lowest level in 18 years. The market recorded large upward movements this week, with all sectors again posting positive results. In another positive sign, fresh business was recorded on Thursday night.

The national offering was down by 426 bales, or 1.4%, at 29,242 bales. Of these, 97.6% were cleared. The offering appears to have shaken off the drought impacts with increased availability of lots assessed as MF 4 and carrying favourable additional measurements. Merino fleece attracted strong widespread competition, pushing prices continually higher across all microns and descriptions. As buyers fought hard to secure volume, the market continued to rise until the final hammer.

On Tuesday, the EMI gained 44 AUD cents to 1,066 AUD cents a kg or up 37 US cents at 764 US cents. Wednesday saw the pace accelerate a bit to 51 AUD cents and 37 US cents. Thus, the EMI closed the week at 1,117 AUD cents a kg clean or 801 US cents a kg, up 95 AUD cents or 74 US cents. In percentage terms, the rise was 9.3% and 10.2% in the respective currencies.

AWEX reported turnover of wool sold this week stood at AUD$38.82m this week, taking the total to AUD$397.12 for the current season.

Major buyers this week were: Endeavour Wool (4,263), Techwool (2,792), Australian Merino Exports (2,377), and PJ Morris (1,805), among others.

In Sydney, solid demand, large price hikes and a 99% clearance rate characterised the merino fleece sale on Tuesday. Wednesday produced further price rises with all merino microns closing the week significantly higher. Finer microns (<18.5 µm) gained 140 to 152 AUD cents. The merino skirtings market performed strongly with finer (<18.5 µm) lots rising to 80 AUD cents on Tuesday and further by 100 AUD cents on Wednesday. The crossbred sector strengthened across all types and descriptions, resulting in price rises. Finer (<17.5 µm) categories of oddments gained on both days. The Northern Regional Indicator jumped 108 AUD cents to 1,184 AUD cents a kg clean and the clearance rate improved further to 98.3% from 96.1% last week.

In Melbourne, Tuesday’s sale mirrored Sydney with high clearance rates and prices jumping 23-67 AUD cents. Fine, MF 4 lots gained 70 AUD cents. More of the same occurred on Wednesday as buyers sought to secure quantities as the sale progressed. All microns gained upwards of 100 AUD cents for the week, except the 22 µm which lifted 66 AUD cents. The merino skirtings market strengthened with the finer (<17.5 µm) lots up 75 AUD cents on Tuesday followed by matching price rises on Wednesday. The crossbred sector was lifted on both sale days while oddments were mixed on Tuesday before combing length crutching and lambs lots rose up to 50 AUD cents on Wednesday. The Southern Regional Indicator increased 88 AUD cents to 1,075 AUD cents a kg clean with the clearance rate jumping to 97.9% from 94% last week.

In Fremantle, the one-day sale on Wednesday produced price rises across the merino microns. The merino skirtings market also surged with prices rising up to 190 AUD cents. Oddments enjoyed price rises of up to 40 AUD cents for locks and 50 AUD cents for crutchings and stains. The Western Regional Indicator surged 113 AUD cents to 1,167 AUD cents a kg clean with the clearance rate recovering to 95.8 % as against 95% last week.

The large price hikes have enticed more sellers to the market, pushing the national offering higher next week to 34,093 bales. All centres will operate over both days.