The widespread rain of last week has presented many of the south eastern districts with flooding and restriction of shearing and movement of wool will become more difficult.
To make matters worse at the time of penning this report, the forecast of heavy rain sweeping down the east coast will no doubt increase the current disaster areas and hinder shearing and wool movement.
The AWEX EMI closed on 1323c – up 52c at auction sales in Australia last week.
It was the largest weekly rise in the EMI in 16 months and when adding together, the market has recovered the losses posted over the last 6 weeks.
A total of 35,407 bales went under the hammer with all of the MPG’s in the three selling centres posting solid rises. The EMI rose 31c on Tuesday and 21c on Wednesday, so it was no surprise to see a solid clearance rate of 94.8%.
| Merino Fleece saw strong and widespread competition from the opening lots offered. Whilst the 16.5μ MPG added 38c in the northern markets, the 17μ through to 21μ MPG’s added between 66c-80c. Competition came from the large trading Australian exporter houses and the large Chinese processors with over 51% of the fleece purchased by the top 4 buyers. Competition was electrifying on the better style and specified fleece lots, however all merino fleece types and descriptions posted gains in the rapidly rising market. Merino Skirtings added 25-40c for the week which was slightly lower than some of their fleece counterparts, recognising that merino skirtings have out-performed the ailing fleece for the last 3 months. There were notable price differences between the well prepared, desired spec wools and lower spec wools in the skirtings. The same top 4 buyers dominated this sector as the fleece, purchasing a whopping 61% of the offering. Crossbred Fleece posted solid rises across both days with the 26 MPG +45c, the 28 MPG +25c and the 30 MPG adding +17c. The well classed and specified lots were keenly chased by the competition and sat well above the average quotes. |
| Merino Cardings followed their combing counterparts with noticeable competition on selected lines of Merino Stains which added 30-40c for the week. Increased prices for Merino Locks and Crutchings were at times 15-25c better whilst the weaner and lambs attracted good competition at better prices. Crossbred oddments saw a slight improvement in the support for these types. Whilst prices are still extremely low, the ability to cover the cost of selling may now be achievable for the lower Stains and Crutchings. After a prolonged period of extremely poor market conditions, it seems that the catalyst for the positive price change has been short supply caused by a gradual reduction in the weekly sales volumes, rather than improved demand. Whilst the quantity squeeze has had a positive impact for the seller, I believe there has been some blood spilt by some exporters purchasing against forward sale commitments. Meanwhile, economies around the world face extreme inflation which is eroding confidence at retail. It is expected that discretionary spending will continue to diminish in the short term. The sharp rise in the wool market has attracted a slight increase in next week’s offering with 42,433 on offer nationally. ~ Marty Moses |