Upswing in wool market welcome news and creates cautious emotion

The upswing in the wool market was welcome news in a sea of global negativity over the past few months. There were 39,157 bales offered, with 95.3% of the offerings cleared for trade, marking the best clearance in 12 months.

The AWEX EMI closed the week at 1139 cents, up 11 cents at auction sales in Australia this week.

The renewed business activity shifted the market sentiment from doom and gloom to a short-term positive yet cautious emotion among exporters, at least for the next couple of weeks.

It was previously thought that 2023 might be a dead rubber as far as the wool market was concerned, there is now a hint of optimism emerging for sales in November.

However, it takes more than one good result to form a trend, so I think exporters will stick to their conservative purchasing strategies for at least the next 4 weeks.

Merino Fleece opened immediately on a positive note. While this may have been due to new business being generated on the back of the previous week’s lower AUD, many exporters commented on the improved selection of Combing wools in the northern market.

China dominated the merino combing purchases, but moderate competition was also noticeable from India, and European interests helped the merino MPG’s increase by 11 to 56 cents. India is concentrating its purchasing on the coarser merinos (20.5µ to 22.5µ), while the Chinese are beginning to compete across a wider range of types.

Merino Skirtings followed the fleece market upwards, with the finer skirtings capturing the largest rises for the week.

Crossbreds closed between 8 and 30 cents cheaper for the week. While the two large Chinese traders continued to dominate the XB purchasers, competition from Europe, India, and Thailand was also noticeable. Despite the falling prices for Crossbreds, those at 31µ and coarser levels seemed to maintain their previous week’s levels.

Merino Cardings continued under duress, closing the week slightly cheaper. The exception was the 17.5µ and finer locks, crutching, and stains, which attracted slightly better competition.

Next week, the national offering is forecasted to increase to 42,117 bales. Auctions ales resume on Tuesday in Melbourne, Fremantle, and Sydney.

-Moses and Son