Currency played in the favour of wool buyers this week as weakness in the Australian dollar made the purchase price look more attractive to those overseas. Fine and mid-micron segments of the market have now returned to levels not seen since June in local terms.
The Eastern Market Indicator lifted 7¢ on the week to settle
at 1,144¢/kg. This is the highest level for the EMI since June, however,
doesn’t tell the full story. When viewed in USD terms, the EMI slipped 1¢ this
week to 741¢/kg. Hovering at around the 740 US¢ level, the market has spent
November sitting lower than the levels of October.
The fine wool segment shone this week. A super-fine sale in
Sydney produced solid competition for stylish (MF3 & MF4) lots with
favourable additional measurements (80mm & 50 N/ktex). They achieved high
clearance rates (96 & 97%) on both days of selling.
16.5MPG in Sydney lifted 50¢ on the week to 1806¢, and other
microns 17.5 and under in Sydney and Melbourne achieved gains of 20 to 40¢.
Medium fleece in Sydney saw minimal price movements week on week, while in
Melbourne this segment garnered stronger attention with prices up 10 to 20¢ for
19.5 to 22MPG.
In Fremantle green was also splashed across the board with
prices improving around 10 to 20¢ for all MPGs except for 21 micron which held
steady.
Crossbred fleece failed to muster up the same level of
attention as the bounce in the Merino segment this week. In Sydney, some
reluctance was noted to bid for lots with high CV, although well-prepared lots
firmed. 26MPG in Sydney and Melbourne were down 21 and 10¢ on the week
respectively. 30-32MPG were unchanged week on week.
Tighter supply was another factor driving the price uplift
in some categories this week. 33,366 bales were offered to the trade which was
around 5000 bales fewer than the week prior. With a pass-in rate of 5.5% for
the week, this resulted in 31,530 bales sold. This time last year we were
looking at weekly sales of over 40,000 bales so the current supply pales in
comparison. With the flock shrinking (particularly in WA) this will have
implications for supply going forward (read
more here).
Next week
With many segments of the Merino market at the highest levels since June, next week’s roster suggests growers are getting in while they can. Across the sales on Tuesday and Wednesday in all centres, 39,580 bales are forecast on offer.
The increased offering of wool bales stirred a range of outcomes this week, particularly affecting the finer micron wool segments. On balance, the Eastern Market
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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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Fine wool shines amid currency slide
The Eastern Market Indicator lifted 7¢ on the week to settle at 1,144¢/kg. This is the highest level for the EMI since June, however, doesn’t tell the full story. When viewed in USD terms, the EMI slipped 1¢ this week to 741¢/kg. Hovering at around the 740 US¢ level, the market has spent November sitting lower than the levels of October.
The fine wool segment shone this week. A super-fine sale in Sydney produced solid competition for stylish (MF3 & MF4) lots with favourable additional measurements (80mm & 50 N/ktex). They achieved high clearance rates (96 & 97%) on both days of selling.
16.5MPG in Sydney lifted 50¢ on the week to 1806¢, and other microns 17.5 and under in Sydney and Melbourne achieved gains of 20 to 40¢. Medium fleece in Sydney saw minimal price movements week on week, while in Melbourne this segment garnered stronger attention with prices up 10 to 20¢ for 19.5 to 22MPG.
In Fremantle green was also splashed across the board with prices improving around 10 to 20¢ for all MPGs except for 21 micron which held steady.
Crossbred fleece failed to muster up the same level of attention as the bounce in the Merino segment this week. In Sydney, some reluctance was noted to bid for lots with high CV, although well-prepared lots firmed. 26MPG in Sydney and Melbourne were down 21 and 10¢ on the week respectively. 30-32MPG were unchanged week on week.
Tighter supply was another factor driving the price uplift in some categories this week. 33,366 bales were offered to the trade which was around 5000 bales fewer than the week prior. With a pass-in rate of 5.5% for the week, this resulted in 31,530 bales sold. This time last year we were looking at weekly sales of over 40,000 bales so the current supply pales in comparison. With the flock shrinking (particularly in WA) this will have implications for supply going forward (read more here).
Next week
With many segments of the Merino market at the highest levels since June, next week’s roster suggests growers are getting in while they can. Across the sales on Tuesday and Wednesday in all centres, 39,580 bales are forecast on offer.
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Click on graph to expand
Click on graph to expand
Data sources: Nutrien Ag Solutions, 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.
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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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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.