Home / Knowledge / News / Textiles / Aussie wool prices correct after two-week surge
Aussie wool prices correct after two-week surge
13
Sep '13
After two successive weeks of extraordinary price rises, the somewhat too familiar and inevitable “correction” occurred this week across most wool types. A combination of factors conspired to turn the market on its head. As a result, effectively 50 to 60 acents were wiped off Merino fleece values as the market moved into the buyers favour. On a more positive note, all Merino skirtings were basically maintained or became dearer at their comparatively high levels.

This week we witnessed the rare occurrence whereby the skirting and open type types were achieving similar to slightly higher clean prices than the fleece counterparts of similar quality. Crossbred and carding types managed to hold on reasonably well, but by weeks end had up to 15 acents shaved from their levels.

Reportedly, a sudden and unforeseen increase in bales offered by more than 20% gave exporters and overseas buyers the opportunity to be more opportunistic in their purchasing. Originally slated for about 40,000 bales the series turned up with 48,000 bales with little advance warning to the trade of the increased offering. From the opening lot of selling, the market, particularly the Merino fleece section, was effectively eased backward in price in a very controlled manner with sale room operators testing out each other’s willingness and intensity to buy.

The resultant weak and retreating market became inevitable. In the wash up, a massive 17% of wool offered had been passed in, a figure which nearly matched the additional quantity that had been added to the sale series.

In the past three weeks, a high percentage of the Australian wool clip has been purchased by relatively few buyers. Spot demand for Merino fleece appears filled, whilst skirting types remain in an oversold situation.

Crossbred and cardings also appear to be less under pressure, but buyers may well have taken the opportunity to pull back prices. With so few buyers buying the majority of wool, finances would be getting tight for these exporters who will now need to concentrate what money they have on hand for immediate delivery orders, and any discretionary spending for future order cover or speculative stock buying was virtually eliminated for a number of them.

The sharp strengthening of the AUD: USD to over $0.92 has also stemmed the flow of fresh business being written, as rumour has it that a few of the major Chinese buyers were/are expecting our currency to be trading in the mid 0.80’s by November/December period where demand appears to be unfulfilled.

September and October shipment months now appear well covered and the urgency for forward contracts seems diminished. With a new Australian government to be sworn into office next week, there is an air of unpredictability of the Aussie dollars direction, but most pundits are expecting the new power to be resilient in their approach to making the dollar work in favour of our exports and a weaker Aussie dollar will hopefully spur our market back into a positive direction.

Next week will again feature a large offering. Hopefully some confidence and positive demand signals can be found by those trade participants attending the annual Nanjing Wool Market hosted International Wool trade Conference in China until Monday. With the auctions finishing on a very limp note and a large volume of wool hit-ting the deck, it would be very difficult to predict a market recovery occurring in the upcoming series.

Australian Wool Innovation Limited


Must ReadView All

Textiles | On 22nd Jul 2017

Govt constitutes GST Feedback and Action Room

The Government of India has constituted a Feedback and Action Room...

Textiles | On 22nd Jul 2017

India’s cotton textile exports fell in FY17: Tamta

The overall export of cotton textiles from India declined in 2016-17...

Textiles | On 22nd Jul 2017

Stella McCartney, Bolt Threads partner for eco fashion

Fashion designer Stella McCartney has partnered with Bolt Threads for ...

Interviews View All

Smith Vaghasia
Sanado India

Online remains the best destination for shopping

Sunil Rathore
Lacoste India

‘New vendor is welcome if he offers cost, quality and timely delivery’

Amit Jain
Shingora Textiles Ltd

‘In terms of fabric, the fastest growing category for us is a blend of...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Kevin Nelson
TissueGen

Kevin Nelson, Chief Scientific Officer, TissueGen discusses the growing...

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Yash P. Kotak
Bombay Hemp Company

One of the directors of Bombay Hemp Company, Yash P. Kotak, speaks to...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

July 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Thanks for your valuable feedback. Claim your free latest sustainability e-book.


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search



X