Nutrien Ag Solutions sheep farm.

A superfine sale in Sydney and more low VM wool on the East Coast stalled a recent bout of downward price pressure. Pressure seems to be the predominant theme as the Fremantle market tried to regain footing following a week long hiatus from sales.

On balance, it was a better week for the East Coast wool market as the Eastern Market Indicator (EMI)  improved 4ȼ to 1131ȼ/kg.  With the exchange rate still hovering in the 0.64ȼ range the EMI expressed in US$ improved 7ȼ to 732 ȼ/kg.

The start was strong for the Sydney Superfine sale with low pass-in rates (4.8%) and improvements across finer categories on Tuesday.  This momentum didn’t carry into Wednesday and final results were mixed.  18MPG rose 18ȼ to 1533 ȼ/kg and 19MPG increased 19 ȼ to 1405 ȼ/kg.

Southern markets got up off the canvas this week, as all categories (with the exception of 17MPG ) improved on the back of a strong opening day to sales.  Preference for low CVH and low VM lots pushed pricing upward on Tuesday but eased on Wednesday. 16.5 MPG finished 21ȼ higher to 1953 ȼ/kg and 21MPG increased 18 ȼ to 1277ȼ/kg.  

Fremantle market returned this week and had to “face the music” after missing last week’s performance.  All categories saw double-digit declines with the 18MPG falling 49ȼ to 1500ȼ/kg and 21MPG losing 67ȼ to 1274ȼ/kg. This dragged the Western Market Indicator (WMI) down 3.8% to 1270 ȼ/kg (-50 ȼ).  This is 1ȼ below where the WMI finished the 2022/23 season so the start of season sugar-hit has now been erased.

Crossbreds crept upward again in Melbourne, with 28MPG up 5ȼ to 345 ȼ/kg.  Cardings in Sydney lost 8 ȼ to 722 ȼ/kg and improved 3 ȼ to 698 ȼ/kg in Melbourne. Fremantle cardings had a steeper decline, losing 26ȼ to 717ȼ/kg. 

With the return of the Fremantle sales, the national offering increased 15% week on week, to reach 44,690 bales.  Despite the Western market pricing trending lower to fall in line with the losses of the East seen last week, the overall pass-in rate finished lower this week, to sit at 11.1%. 44% of the offering had <1.0% vegetable matter (vm) which was a 6% improvement on the previous week’s offering.  39,716 bales sold this week, which is 2% above the weekly average figure of bales sold for the 2023/24 season thus far.

This week on Mecardo, Andrew Woods provides analysis on Merino Price Curves (read here). Based on the performance of some micron categories in relation to 10-year median levels, the market is not yet flagging itself as being at a low point. 

Next week

Sales are scheduled for Tuesday and Wednesday in all three centres with an expected 45.5K bales to be offered. 

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Click on graph to expand

Click on graph to expand

Click on graph to expand

Data sources: AWEX, AWI, Mecardo

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