The Eastern Market Indicator (EMI) fell by 128¢ this week to close at 1,006¢ influenced by a stronger Australian dollar which lifted US2.5 cents since the last sale (10th July) to US$0.719 which influenced the EMI in USD terms to a somewhat subdued 63¢ fall to 723¢. The Western Market Indicator gave up 147¢ from the previous sale to settle at 1055¢.
The offering increased by 7,500 bales on the last sale to 42,764 bales this week, overwhelming the market and with a pass-in rate of 30.1%, 29,911 bales were sold, down 3,000 bales. WA passed 51.2% of all wool offered, and 58.9% of Merino fleece lots, to only clear 3,995 bales to the trade.
Analysis by Mecardo (Andrew Woods) this week looked at AWTA test data and demand, with a three-month review indicating that the market under COVID-19 conditions can “absorb in the range of 70 to 80,000 bales per month”, so the 42,700 offered this week was always a risk to the market.
No indicators were spared, with -150 to 210¢ losses for all Merino types.
The Crossbred sector also buckled, with 35 to 82¢ falls reported. AWEX noted that in percentage terms they were similar to the Merino types.
Cardings didn’t fare any better, -85¢ in Sydney, -99¢ in Melbourne and giving up 151¢ in WA. on the 700 bales of cardings that sold.
Next week we drop back to 33,413 bales, demand however is suffering from a complete lack of confidence so it is difficult to b optimistic that the market has bottomed.