The Australian wool market could not sustain the strong gains posted last week, as the auctions regressed this week to post losses across most offerings. The best end of the merino fleece offering and the broadest crossbred fleece were the only categories unaffected, trading at similar quotes. Price levels meant that buyers were more hesitant to secure volumes as the sales progressed and the cheaper levels emerged prevalently. Auctions were held in Sydney and Melbourne this week. There was no sale in Fremantle.
The Australian Wool Exchange Eastern Market Indicator was down 1.2%, or 23 cents, to close the week at 1,864 Aus cents a kg clean, which was also 4.5% below the seasonal average. In US dollar terms the EMI fall was limited to just 0.6%, or 8 US cents, to 1,300 US cents a kg clean. The AUD foreign exchange rate strengthened 0.7% against the USD.
This week the national offering was 21,739 bales, compared with 28,273 bales last sale. The clearance rate was 84.4%.
On Wednesday, the EMI lost 7 cents to 1,880 Aus cents a kg clean but was up 9 cents at 1,316 US cents a kg. On Thursday, the loss aggravated to 16 cents to 1,864 Aus cents a kg and lost 17 cents in US dollar terms to 1,299 cents a kg.
In Sydney, Wednesday sales saw 18.5 and finer lots with best style and favourable additional measurements attract strong buyer support. These lots maintained last week’s price levels, however, poorer style lots with low staple strength were discounted which pushed most prices lower. Thursday’s sale saw further reductions across all microns with the finer types most affected. Merino skirtings eased on Wednesday. On Thursday, best style skirtings with favourable additional measurements maintained previous price levels. Crossbred lots eased while oddment lots were generally unchanged.
The Northern Regional Indicator lost 26 cents to end the week at 1,833 Aus cents a kg clean with a clearance rate of 86%, as against 95% in the previous week.
The Melbourne sale started slowly on Wednesday with low clearance rates, which decreased as the sale progressed. Best style lots with high strength were keenly sought by buyers. Lower style lots dominated Thursday’s sales and dampened the tone of the sale. Merino skirtings followed the same trend as the merino fleece lots on Wednesday, but a high proportion of poorer style, faulty lots with high VM on Thursday weakened the skirtings market. Well-prepared crossbred lots attracted strong demand while oddment lots lost ground. The Southern Regional Indicator retreated 22 cents to 1,852 Aus cents a kg clean with a clearance rate of 83%, as against 91% last week.
Next week will see Fremantle return to auction selling, bringing a national offering of 29,989 bales.
