Australia's merino wool prices surge amid strong global demand

China's increased buying pressure initially spurred the market's upward trajectory. However, other global wool destinations, including Italy and India, have also intensified their auction activities, placing higher bids to secure pre-Christmas supplies and price stability, the Australian Wool Innovation Limited (AWI) said in its commentary for sale week 21 of the ongoing Australian wool marketing season.

Local Australian traders and leading exporters dominated the buyers' lists this week, with their strategic buying and forward commitments contributing to the price gains. As offshore users raised bid prices in response to the market's opening strength, traders were encouraged to offset initial losses from lower-priced contracts and potentially profit from new sales.

Interestingly, the third largest of China's top wool makers has been overshadowing the traditionally dominant top two makers in recent weeks. This shift is attributed to the company's specialisation in uniform supply for local Chinese industries and state-owned enterprises, with a significant portion of recent government uniform orders reportedly directed to this factory, the AWI commentary added.

Looking ahead, over 49,000 bales are scheduled for sale next Tuesday and Wednesday, marking the last designated super fine sales until February 2024. With just three weeks of auctions remaining before the annual three-week recess over the Christmas and New Year period, the wool market continues to exhibit dynamic trends driven by global demand and strategic buying.

Fibre2Fashion News Desk (KD)