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Au$ assists wool market

The wool market remains subdued although an easing in the Au$ this week assisted the market to post a modest rise. Despite the relatively stable market, concerns are emerging that logistics is fast becoming a sticking point for wool exporters and warnings that this may impact competition in the saleroom, if not soon remedied.

The Eastern Market Indicator lifted 8¢ for the week to finish at 1285¢. In US terms, thanks to a 2.9% fall in the Aussie dollar, the EMI gave up 23 US¢, to finish at 977¢ cushioning prices received by sellers.

At Fremantle sales, the WMI followed the national trend and lifted 13 cents to finish at 1346, with all categories posting gains of 5 to 18 cents.

Finer types received the strongest interest and posted rises in the range of 5 to 15 cents, with Sydney leading the way. There was a more mixed result in Melbourne with the 20 to 22 MPG losing ground slightly.

The Crossbred offering held steady with the 26,28 & 32 MPG’s all up slightly, while 30 MPG was marginally down (-3 cents).

Cardings again posted a solid result, with Sydney +12 cents, Melbourne -5 & Fremantle strongly up 37 cents.

A reduced offering of 38,564 bales came forward, and with a national pass-in rate of 9.4%, 34,956 bales sold this week. This is the lowest clearance for 2021, however still marginally above the average for the season to date.

On the logistics front, exporters are reporting that delays to shipping stems are impacting on delivery to destination, which in turn continues to tie up exporters’ available funds to trade. According to reports, there is little certainty of boxed wool leaving ports, with export-ready containers suddenly jettisoned onto revised schedules and advised that their new schedule is “subject to change”. This situation has the potential to reduce competition in the auction room if it is not soon corrected.

This week on Mecardo, Andrew woods took a look at Quality schemes in the Australian wool industry. The challenge with quality schemes is to gain the confidence of the supply chain and then to deliver enough volume to enable the supply chain to plan and acquire accredited wool for a wide range of yarns and fabrics, which is no easy feat. It’s still early days for these schemes, with key merino micron category volumes still relatively small compared to overall volumes.

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The week ahead….

Next week’s offerings is listed at 48,829 bales over Tuesday & Wednesday as we move into the traditional one-week Easter recess, with sales listed to resume on week beginning 12th April.

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Data sources: AWEX, AWI Mecardo

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