Wool market with widespread competition

22 Mar '10

3 min read

The Australian wool market finished 1.2% higher, on average, at sales in Sydney, Melbourne and Fremantle this week when the US exchange rate rose by 0.8%.

It was also the week that a bale of 11.4 microns speciality Ultrafine wool was sold after auction in Melbourne for 170,000¢. 11.4 microns is the finest measurement yet recorded for a bale of Australian wool. The bale is headed for Raymond in India.

43,173 bales were on offer, compared with 35,200 bales last week. 8.2% were passed in, comprised of 6.7% in Sydney, 8.1% in Melbourne and 10.2% in Fremantle. Pass-in rates for Merino fleece and skirtings were 10.6% and 5.3%, respectively.

1,236 bales (2.8%) from the expected offering of 44,409 bales were withdrawn prior to sale and re-offered bales made up 11.4% of the final offering. 39,636 bales were cleared to the trade.

Exchanges rates remained high, as the United States Reserve announced that interest rates were not increasing there; and uncertainty in some European countries continues to weaken the Euro. Exchange rates of over 67¢ seen in the last two weeks are the highest recorded against the Euro.

It was a another good market, with widespread competition, even though not all buyers for China was as active as they have been in other weeks, and the exchange rates rose against all key currencies. The strong market on Wednesday resulted in a 9¢ lift in the EMI on that day, with a further, but more modest, lift of 3¢ on Thursday. Rises were recorded for all wool types and micron ranges in all currencies.

Prices for skirting types were up in all Regions on Wednesday and remained firm, or up, in the North and South on Thursday. Prices were easier in the West on Thursday in line with an easing in fleece type prices. Crossbred average MPGs were up by 2.5% to 3% at the fine and medium end and by 2.2% for 30 microns and by 1.1% for 32 microns. Oddments again rose, with the average Merino Cardings MPG up by 12¢ (+1.8%).

Buyers for China were again dominant, followed by buyers for Europe, Taiwan, and India.

Sales will be held in Sydney, Melbourne and Fremantle next week, when 44,184 bales are currently rostered for sale. The present estimate for the following sale (Week 40) is 44,830 bales; a decrease of 4.2% over the two sale period when compared with last year. Sales will be in recess in Week 41, the week after Easter.

In South African sales, the Cape Wools Indicator was up by 2.2% since last week against a 1.1% appreciation of the Rand against the US Dollar and a 0.4% depreciation against the Euro. 6,530 bales were on offer.

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Australian Wool Industries Secretariat

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