Chinese Topmakers adopted a cautious approach to purchasing early in the week which was the trigger for the traders to pull back their price ideas for the week. Since the reopening of the 2022 sale series in July, the EMI has not posted a positive result. The EMI opened on 1,430c and over the 6 sales held so far, the EMI has dropped by a total of 100 cents, (7%.).The AWEX EMI closes on 1330c – down 12c at auction sales in Australia last week. Where to from here? Firstly, it is not unusual to see the wool market floundering at this time of the year and traditionally September. Added to this, there are some obvious headwinds for international trade starting with the Chinese lockdown of Chengdu province of 21 million residents, to contain yet another Covid-19 outbreak as they try to implement Xi’s zero Covid policy. It’s hard to imagine a short-term respite for commodities as the world’s largest consumer goes back into hibernation; The War in Ukraine; Shipping and logistics restrictions; finance and China’s open intent to increase pressure on Taiwan. On top of that, the world is grappling with post Covid increases in Inflation, we have a worldwide labour shortage and the pressures on the cost of living. All of these point to a slowing of world economies. The Superfine offering in Sydney attracted a high level of European interest on the solid numbers of suitable types on offer which assisted the Northern MPG’s to remain relatively unchanged. Currency Exchange started the week relatively high and progressively moved down during the week, keeping it in line with last week’s exchange rate. Merino Fleece saw Sydney record a reasonable result on paper. 5 of the 8 MPG’s reported were able to post gains of 1c through to 11c whilst the 17.5, 18.0 and 19.0 MPG’s gave back between 2 and 12c. As can happen, the MPG’s were flattering and possibly overstated by the number of best and spinner specialty types on offer that attracted the Italian buyers to open their purse strings. Anything outside these specs and finer than 19.0 were heavily discounted as indicated by the solid falls in the Southern and Western markets, whilst the 20 and 21μ MPG’s remained less affected, giving back 2-8c cheaper in the southern region. Chinese Topmakers adopted a cautious approach to purchasing early in the week which was the trigger for the traders to pull back their price ideas for the week. There were certainly many types neglected during this week that have been supported by the large Chinese processors over the past 2 months. Certified Integrity NM lots continued to attract a solid premium over the market. Merino Skirtings opened the week generally unchanged with the higher VM types and the 16-17μ types retracing 10-20c on Tuesday with this pattern continuing into Wednesday. Once again the best style and specified lots held up relatively well and the rest struggled to maintain last week’s levels. |
| Crossbred held up relatively well off a very low base. 28 MPG was off 5c in Sydney and posted no change in Melbourne. As in the past, the best classed and specified lots were preferred over the unclassed and poorly specified lots which at times, do not attract a bid.
Merino Carding Indicator gave back 9c in Sydney and Fremantle, and 17c in Melbourne with the largest damage concentrated to the low style, high VM lots. Crossbred oddments saw a bit of new interest shown on lots previously neglected, despite the prices paid coming from a historically low base. Quantities for next week fall just short of 40,000 bales with 39,562 bales on offer in Sydney, Fremantle and Melbourne. Early expectations are that 19.5 and coarser combing Merino wools should maintain this week’s levels whilst the fine and superfine types with less than perfect processing specifications will remain under price discount pressure. ~ Marty Moses |