wool being inspected

This week in the wool market, buyers were seeking the finer things in life, specifically fine merino fleece in both eastern and western markets. Despite a slight decline in the Australian dollar, prices increased for most microns, with finer categories leading the charge. This resulted in another strong week for the Eastern market indicator (EMI), a positive sign ahead of next week’s dedicated superfine sale in Sydney.

This week the EMI increased 18ȼ to 1356ȼ/kg. The Australian dollar was down slightly to US$0.70, resulting in the EMI when expressed in US$ terms pushing 6ȼ/kg higher to 956ȼ/kg (US).

The Western Market started the week on a positive note as well, this continued through to Wednesday, where a small offering and continued buyer support across all categories saw the Western Market Indicator (WMI) increase 35ȼ to finish the week at 1510ȼ/kg.

All three markets saw a positive uptick in prices across fine and medium categories. The 16.5MPG was up 56ȼ to 2418c/kg in Sydney and up 59ȼ to 2431c/kg in Melbourne.

Crossbreds had a relatively positive week considering the focus on other categories.  The 28 MPG in Sydney increased 12ȼ to 340ȼ /kg.

Cardings were stronger this week, improving by 18ȼ in Sydney, and Melbourne and Fremantle were both up 16ȼ.

Again we saw a smaller offering this week of 38, 516 bales and a pass-in rate of 6.6%. 35,986 bales were sold, down again this week. Since early December, weekly sales volumes have been high compared to the weekly average for the season to date (35,000 bales). So, this week stood out as a return closer to levels of earlier in the season.

This week on Mecardo, Andrew Woods investigates seasonal patterns of good merino fleece and the low-level supply currently in the market.  Conditions in recent years have reduced the proportion of best-quality merino fleece sold and seasonal patterns indicate this proportion will remain low until the next season.  In turn, premiums for good merino fleece are likely to be supported due to low supply.

The week ahead….

Next week’s offering of 51,166 bales is considerably higher than the previous two weeks as the calendar year ramps up. Melbourne will have an additional Thursday sale on top of Tuesday and Wednesday.  Sydney is a designated superfine sale.

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Data sources: AWEX, AWI, Mecardo

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