The second sale of the new selling season extended the positive tone of the previous week with gains across all microns in all three selling centres. A three-week sale recess also sparked demand from buyers as they competed at the last auction before 7 August. While price gains were witnessed across all types and descriptions, it was the better style lots with favourable additional measurements that attracted most buyer interest.
The Australian Wool Exchange Eastern Market Indicator finished the week up 1.8%, or 31 cents, at 1,754 AUS cents a kg clean. In US dollar terms, the EMI gained 0.9%, or 9 US cents, at 1,222 US cents a kg clean. On Wednesday, the EMI jumped 17 cents to 1,740 AUS cents a kg clean and down 8 cents at 1,204 US cents a kg. On Thursday, the EMI further gained 14 cents to 1,754 AUS cents a kg clean and surged 18 cents in US dollar terms to 1,222 cents a kg.
The national offering was 34,080 bales, compared with 30,991 bales in the previous week. The clearance rate improved to 93.7% from 93% in the previous week. The AWEX reported a total value of the wool sold at AUS$59.9m (AUS$1,880 per bale), taking the season total to AUS$113.8m (AUS$1,869 per bale.
The Sydney sales began amid strong competition for all descriptions and types, pushing prices up on Wednesday. Keen buyer demand continued on Thursday, particularly for MF4 and MF5 lots with favourable additional measurements. Merino skirtings increased on both days, gaining 90 cents for the week. Broader crossbred lots gained between 30 and 45 cents, with oddment lots also gaining in value. The Northern Regional Indicator rose 42 cents to 1,780 AUS cents a kg clean with a clearance rate of 95%, against 98% last week.
In Melbourne, the sale started on a positive note and all microns gained in value. Thursday’s sale was also robust with further gains across all types. Finer lots with best style and favourable additional measurements attracted premiums. Skirtings strengthened across both days with increases of up to 65 cents. Crossbred lots increased, particularly those which had been well-prepared. Oddment lots increased, led by lots with low VM. The Southern Regional Indicator gained 24 cents to 1,737 AUS cents a kg clean with a clearance rate of 95%, as against 93% last week.
In Fremantle, the single-day sale saw price increases across all microns from 18.0 to 21.0. Steady competition in the merino skirtings sector pushed values up with oddment lots also trending dearer. The Western Regional Indicator closed at 1,894 AUS cents a kg clean, up 27 cents, with a clearance rate of 88%.
Market activity this week imitated the trends of the last few months. Chinese top makers, the largest Australian manufacturers and traders picked up the majority of bales on offer. The top four buyers in each market secured over 50% of the volume on offer.
With prices rising in the first two weeks of sales entering the 2019-20 season, it was a much-awaited result after the prolonged run of losses to finish the 2018-19 season. The mid-year break is the time when many exporters take the opportunity to meet overseas clients. The positive movement of the market thus was timely, as doing business in a depressed market is very difficult. The market now moves into a three-week recess and sales will resume in Week 6, on 7 August.
