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Australian wool market experiences price declines this week

11 May '23

2 min read

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Insights

Australian wool prices dropped this week due to forex fluctuations. AUD strengthened by 1.5 per cent against the USD, causing a 2 per cent EMI decrease and a 4.1 per cent WMI drop.
Demand remained slow, but Chinese top makers acquired better sale lots.
Superfine Merino wools were most sought after, though prices fell. Clearance rates dipped to 75 per cent.

The Australian wool market saw a downturn in prices during week 45 of the 2022/23 marketing season, primarily due to fluctuations in foreign exchange rates. The Australian dollar strengthened by 1.5 per cent against the US dollar, resulting in a 2 per cent decrease in the Eastern Market Indicator (EMI) and a more substantial 4.1 per cent drop in the Western Market Indicator (WMI).

Demand for wool remained slow, but outstanding orders from forward book operators provided some support to the market. Buyers from China, Europe, and India were present, though their purchasing activity had slowed. Despite the overall market weakness, top makers in China managed to acquire better-quality sale lots than usual, the Australian Wool Innovation Limited (AWI) said in its commentary for sale week 45 of 2022/23 wool marketing season.

Superfine Merino wools, finer than 18.5 microns, were most sought after, but prices still dropped between 20ac and 40ac. Wools broader than 18.5 microns experienced more significant losses, particularly in the Fremantle centre. Skirting wools and cardings also saw price reductions, while crossbred wools remained relatively stable.

Clearance rates dropped to just over 75 per cent this week, but the rostered volume for next week auctions is set to increase to nearly 49,000 bales, with sales scheduled for Tuesday, Wednesday, and Thursday.

Fibre2Fashion News Desk (RKS)

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