EMI of Australian wool market to strengthen by August 2021: TexPro

The EMI had witnessed a slight drop of 2.44 per cent in the third week of March 2021, but recovered again by 2.27 per cent to reach Au$13.06 per kg in the second week of May 2021, as per Fibre2Fashion’s market analysis tool TexPro.

After the first half of May 2021, nearly all types of Merino wool showed price gains, especially the super fine types (finer than 18.5 micron), due to a strong focus of buyers. Also, the price rise was supported by the increase in the FNF (less than 1 per cent vegetable matter) sale lots. The lower availability of FNF wools in the Eastern states was because of the robust seasonal conditions in most of Australia’s wool growing regions.

The demand was more for FNF wools in the Western Australian (WA) centre, which significantly outperformed both its Eastern centre counterparts in price gains for 19.5 micron and finer wools. WA had the largest percentage of FNF wools available.

The wool prices were on an upward momentum from the beginning of 2021 to the second week of March 2021. The positive trajectory of the Australian auctions continued due to a strong buyer competition emanating from China, majorly for the superfine Merino types, which led to them reaching the pre-pandemic levels. The major buyers showed a high confidence and bought the offering across the entire spectrum of wool types, with strong gains.

In February 2021, the price gains continued in Australian wool auctions with only the cardings sector preventing a clean sweep of rises across all types and descriptions. Prices rose in the first half of March 2021 as well, as Australian dollar dipped sharply against the US dollar week to week. The exporters had to face financial restraints due to a weak logistics chain.

A sudden drop was witnessed in the second half of March 2021 owing to a cyber-attack on wool users’ software. Also, the increasing strength of Australian dollar against the US dollar reduced the prices.

The EMI again recovered towards the end of April 2021 as Merino combing types of all qualities were in demand. The buying interest was prominent from outside of China and almost all the major subcontinents and European states competed strongly with Chinese mills.

Fibre2Fashion News Desk (KD)