The Australian wool market continued its recent recovery this week following the signs of improvement seen midway through last week’s sales.
The Australian Wool Exchange (AWEX) Eastern Market Indicator (EMI) rose by 77 cents (4.3%) for the week to close on 1,858 cents per kilo clean on Thursday 22 November. In US dollar terms, the EMI gained 52 cents (4%) to finish on 1,347 US cents. The Australian dollar against the US dollar finished 0.29 cents (0.4%) lower to close at 72.50 US cents on Thursday.
This week’s total national offering was 31,889 bales, compared with 35,334 bales last week. The clearance rate was 94.15%.
The New Zealand Merino Company offered 1,128 bales in Melbourne on Wednesday, with a clearance rate of 90.9%. Sales were held at all three selling centres on Wednesday 21 November and Thursday 22 November. On Wednesday the EMI climbed up by 46 cents – the largest daily increase in three months – to 1,827 cents, and in US dollar terms rose by 27 cents to 1,322 US cents. On Thursday the EMI lifted by a further 31 cents to 1,858 cents, and in US dollar terms increased by an additional 25 cents to 1,347 US cents.
There were gains across all micron ranges and wool types, with the greatest gains among the fine to medium crossbreds and from 19.5 microns and coarser among the merinos.
AWEX reported that from the opening lot it was evident that buyer confidence had returned. Spirited bidding was obvious across all types and descriptions as buyers fought hard to secure quantity. On Wednesday the lift in the EMI was driven by increases in the merino types of 50 to 70 cents. The strong demand continued into Thursday, pushing prices higher again. Fleece wool was generally selling at levels 30 to 40 cents above those achieved on the previous day.
The average AWEX Micron Price Guides (MPGs) for the merino types moved up by 100 cents or more for the week for all micron ranges from 19 to 21 microns. 16.5 microns rose by 26 cents (1%); 17 microns was up by 36 cents (1.5%); 17.5 microns climbed by 26 cents (1.1%); 18 microns increased by 68 cents (3%); 18.5 microns lifted by 93 cents (4.3%); 19 microns rose by 100 cents (4.8%); 19.5 microns gained 109 cents (5.3%); 20 microns increased by 102 cents (5%); 21 microns rose by 102 cents (5%); 22 microns lifted by 59 cents (2.9%); 23 microns was up by 106 cents (5.2%); and 24 microns increased by 127 cents (7.5%).
The skirtings also posted increases for the week but not to the same extent as the fleece types. General gains of 40 to 80 cents were realised, with wool carrying less than 2% of vegetable matter being most affected.
The crossbred sector continued with its recent rally with prices generally 50 to 80 cents higher. The finer microns experienced the largest increases, jumping by as much as 100 cents. Prices generally increased by 5 to 25 cents, with the largest gains for the better prepared lines. Among the average AWEX MPGs for the crossbred types, 26 microns rose by 105 cents (9.3%); 28 microns rose by 90 cents (11.8%); 30 microns increased by 50 cents (7.4%); and 32 microns climbed by 15 cents (3.1%).
The oddments also sustained their recent revival with further increases of 25 to 80 cents, adding to the gains from the previous series. After 11 consecutive weeks of falls (when it lost 566 cents), the AWEX Merino Cardings Price Guide added 67 cents this week on top of the 89 cent rise last week.
AWEX reported that the total value of the wool sold this week was AU$58.2m (AU$2,007 per bale), taking the season total to AU$1.332bn (AU$2,288 per bale). Buyers for China were dominant, with support from buyers for Europe and India.
The offering for next week (Week 22) is forecast to be 36,447 bales, with the projection for Week 23 36,374 bales and Week 24 40,883 bales.
The combined offerings for the next three weeks are expected to be 23.5% less than in the same period last year. This would mean that the total for the season up to Week 24 would be 18.5% lower than up to the corresponding week last season.
