Merino sheep in Tasmania

This week it was the fine end of the clip that lifted the market in a week where a much smaller offering came forward. 19 MPG and finer added between 24 & 54 cents, with AWEX reporting that it was only losses in the broader Merino section, crossbreds and cardings that prevented the EMI from posting even higher levels.

The Eastern Market Indicator (EMI) lifted 9¢ this week to finish at 1,315¢. In US dollar terms with the Aussie dollar slightly stronger during the week to settle at US$0.778, the EMI gained 15 US¢, to finish at 1,023¢.

At Fremantle sales, the Western Market Indicator (WMI) posted a similar result, gaining 11¢ for the week to settle at 1,361¢.

Again the fine wool premiums have come under notice. Using the 17 MPG premium (basis) over 21 MPG paints a good picture of the situation. Comparing the same sale last year, the premium has grown from 317¢ to 1,020¢. The Southern 17 MPG is 700¢ higher than year-ago levels, while the 21 MPG is at similar levels.

The Crossbreds struggled again this week, recording overall losses for the third consecutive sale. AWEX reported 7 to 18¢ falls, with the 30 MPG falling 7¢ while the 32 MPG gave up 18¢ in Melbourne.

Cardings were mixed with the indicator down 4¢ in Fremantle, up 9¢ in Sydney & down 9¢ in Melbourne.

Almost 8,000 fewer bales came forward with 41,857 bales offered this week after 6.1% of the original offering was withdrawn. With a 10.9% pass-in rate, just 37,300 bales were cleared to the trade, 6,008 bales less than last week. This was the lowest clearance for 2021.

This week on Mecardo, Andrew Woods looked at fine Merino volumes and price. Increasing supply from the mid-1990s to 2010 explains the increasing gross sales value.

Since 2010 median gross sales value for 16-18 micron wool sold at auction in Australia has been US$590 million with two exceptional seasons where the expenditure was 55% higher.

The question is now whether the US$590 million gross sales value is the norm about which supply chain expenditure varies.

The week ahead….

Next week there are 47,028 bales listed for sale across the three principal selling centres. All centres will sell on Tuesday & Wednesday with Melbourne also selling on Thursday.

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Data sources: AWEX, Mecardo

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