This strong and competitive market situation was supported by a much lighter volume of bales on offer, particularly strong indent orders from one of the larger Chinese operators and forward selling exporters keen to execute orders prior to the Chinese shutdown over their New Year period.
Buying interest from Europe and India continues to add valuable support to the market. The AUD:USD exchange rate continues to sit around 88 cents and traded in a relatively narrow band of around 60 points during the selling period. It appears these days, the stability of the exchange, rather than the rate of exchange, assists the wool markets more as far as confidence is concerned.
In what is considered a rare event, the market for every type on offer this week acted in concert, with prices concluding the series at levels 20 to 30acents clean/kg higher across the entire selection.
These rises virtually wiped out the losses of the previous sales week. Obviously the percentage gains were stronger at the lower priced end of the spectrum, indicative that the global wool users are currently keen to also source some quantity at the cheaper end of the raw material supply chain.
For what has seemingly become a trend over the past few weeks since the Christmas recess, the better Superfine Merino fleece sector of 18.5micron and finer has proven to be the most resilient, and price gains have occurred in consecutive weeks. The reduction in availability of these types is concerning the usual buyers of these wools as the likelihood of less strength and lower style becoming generally more prevalent in the Australian wool clip over the next 4 to 6 months is being realized.
A slight pull back was witnessed in the Merino fleece sector of wools broader than 19.0 micron on the final day, but these were minor in magnitude and predominantly restricted to the lower end types, as talk of difficulties of getting new sales into China and payment receipts slowing started to play on the local auction buyers’ thoughts.
With the high cost of stocking wool locally, buyers are reticent to carry too much inventory through the China New Year period, as quite often the payment schedules are put back or delayed 2 to 3 weeks, restricting the buyer’s ability to participate fully in the local market.
It is assumed that the next few weeks of selling will be somewhat affected by a general inactivity from China as they will be in holiday mode. The market and buying patterns of our major purchasers are signalling that demand is inherently strong, as does the strong presence of wool content in the latest fashion ranges released at trade fairs in Europe.
Whilst the next few weeks may see prices struggling to maintain their levels, the short to mid term outlook is reasonably positive, with some trade participants bullish in their forecasts.
Australian Wool Innovation
Textiles | On 23rd Feb 2018
Sympatex Technologies is moving towards sustainability with its...
Information Technology | On 23rd Feb 2018
CLO Virtual Fashion, a leading developer of cutting-edge 3D garment...
Mag Solvics Pvt. Ltd
ITME 2016 exploited our full strength like never before
Transparent supply chain and fair trade will boost sustainable market
Mangalam Industries Pvt Ltd
‘The manufacturing sector is improving day-by-day, becoming better in...
<div>New Delhi-based Brinjal Designs Pvt Ltd manufactures home furnishing...
Oswal Prints Private Limited has been manufacturing and exporting ethnic...
Krypthm Tradelink LLP is a Surat-based manufacturer of westernwear....
Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...
Sidwin Fabric is a manufacturer and exporter of polypropylene textiles and ...
Suominen Corporation is a manufacturer of nonwovens as roll goods for...
Somaiya Kala Vidya
Among the many honours showered on Frater, including Fulbright and Ford...
"We should not compare India and the West. There are things we do that...
<b>Sidharth Sinha</b> has contributed to the successful rebirth and...
Do you think the sustainability space has the needed tools and resources available for a business to lead change?Yes No Skip
Do you see sustainability as a route to business growth?Yes
Total Votes: 102
Do you think adopting a sustainable approach will be a profitable move for your business?Yes No Skip
Do you think the sustainability space has the needed tools and resources available for a business to lead change?Yes
Total Votes: 102
Do you want the world to know about your sustainability journey and your business’ environmental footprint?Yes No Skip
Do you think adopting a sustainable approach will be a profitable move for your business?Yes
Total Votes: 102
Thanks for your valuable feedback. Claim your free latest sustainability e-book.
Do you want the world to know about your sustainability journey and your business’ environmental footprint?Yes
Total Votes: 102