The bounce back in the wool market this week was largely driven by improvement in the 18-19 micron range of price indicators as buyers continue to move with the exchange rate.
The Eastern Market
Indicator (EMI) increased by 4¢ to 1,091¢, just the 2nd time this
season where it finished the week higher than it started. The exchange rate for
the AUD and USD dipped back under 68¢ as the EMI in US terms lost 7¢ to US 731¢.
With wool for export buyers more affordable after the currency movement,
bidding activity on Wednesday was given a boost.
In Sydney 18MPG
rose 23¢ to 1,457¢/kg and 19MPG increased 13¢ to 1,340¢/kg. Further South, and
18MPG in Melbourne jumped 11¢ to 1,459¢/kg. Crossbred wool was (for the most
part) unchanged, and still bouncing at the bottom of pricing for the last
decade. 32MPG in Melbourne lost 10¢ to 267¢/kg.
Per AWEX reports,
wet conditions are disrupting shearing in the west which will likely impact
volumes set for sale for Fremantle in the coming weeks. 18MPG in Fremantle
improved 15¢ to 1,417¢/kg and the Western Market Indicator lost just 1¢ to 1,222¢.
The drop in supply
also played a role at auction this week, with 9,389 fewer bales across the
three centres assisting with clearance rates. Currently the wool market is
averaging just above 31 000 bales sold per week, which is 17% lower than last season’s
weekly average. So, volumes as well as price have taken a hit so far this
season.
In this week’s
fibres analysis article, Andrew Woods updated analysis on RWS premiums for the
Australian wool market (read more here) which look to have firmed slightly in recent months. Whilst not at
the heights seen in previous years, RWS premiums for good merino fleece look to
be around 50 cents per clean kg, as an average. Large premiums have turned up
for merino locks, which given the experience of the large RWS premiums seen in
2022, are unlikely to persist.
Next week
Next week’s offering is expected to reach 32 354 bales, with Fremantle only selling Tuesday and Sydney/Melbourne both selling Tuesday and Wednesday.
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In this report for LiveCorp and MLA, we analysed the historical trends in the demographics of the Australian sheep flock, examining domestic factors that influence farm-level enterprise decision making.
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Dip in dollar drives demand
The Eastern Market Indicator (EMI) increased by 4¢ to 1,091¢, just the 2nd time this season where it finished the week higher than it started. The exchange rate for the AUD and USD dipped back under 68¢ as the EMI in US terms lost 7¢ to US 731¢. With wool for export buyers more affordable after the currency movement, bidding activity on Wednesday was given a boost.
In Sydney 18MPG rose 23¢ to 1,457¢/kg and 19MPG increased 13¢ to 1,340¢/kg. Further South, and 18MPG in Melbourne jumped 11¢ to 1,459¢/kg. Crossbred wool was (for the most part) unchanged, and still bouncing at the bottom of pricing for the last decade. 32MPG in Melbourne lost 10¢ to 267¢/kg.
Per AWEX reports, wet conditions are disrupting shearing in the west which will likely impact volumes set for sale for Fremantle in the coming weeks. 18MPG in Fremantle improved 15¢ to 1,417¢/kg and the Western Market Indicator lost just 1¢ to 1,222¢.
The drop in supply also played a role at auction this week, with 9,389 fewer bales across the three centres assisting with clearance rates. Currently the wool market is averaging just above 31 000 bales sold per week, which is 17% lower than last season’s weekly average. So, volumes as well as price have taken a hit so far this season.
In this week’s fibres analysis article, Andrew Woods updated analysis on RWS premiums for the Australian wool market (read more here) which look to have firmed slightly in recent months. Whilst not at the heights seen in previous years, RWS premiums for good merino fleece look to be around 50 cents per clean kg, as an average. Large premiums have turned up for merino locks, which given the experience of the large RWS premiums seen in 2022, are unlikely to persist.
Next week
Next week’s offering is expected to reach 32 354 bales, with Fremantle only selling Tuesday and Sydney/Melbourne both selling Tuesday and Wednesday.
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Click on graph to expand
Click on graph to expand
Click on graph to expand
Data sources: Nutrien Ag Solutions, ICS, AWEX, Mecardo
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Independent analysis and outlook for wool, livestock and grain markets delivered to you as it’s published
Listen to the podcast
Join the Mecardo team for the Commodity Conversations podcast, where we provide short weekly market recaps and longer conversations with guests to discuss the drivers and trends in livestock, grain and fibre markets.
Research: Analysis of the Australian sheep flock
In this report for LiveCorp and MLA, we analysed the historical trends in the demographics of the Australian sheep flock, examining domestic factors that influence farm-level enterprise decision making.
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We don’t just bring you the most up to date market insights. Find out more about Mecardo’s services including risk management advisory, modelling, benchmarking, research & consultancy.