The Eastern Market Indicator (EMI) lost 15¢ over the week,
with most of the damage occurring on the opening day of sales. The EMI settled
at 1152¢/kg, which is 13% lower year-on-year. Noteworthy swings in the AUD came
into effect. The AUD hit 0.65 USD on Tuesday following the RBA’s unchanged
policy rate and weakness in iron ore but recovered to 0.66 USD on Wednesday
after the headlines revealed an unexpectedly low Australian unemployment rate
of 3.7%.
Sydney came under the most pressure, with 16.5 to 19MPG each
losing anywhere from 38 to 52¢ weekly. Medium fibres experienced more tepid
losses, with the 19.5MPG down 23¢ over the week.
Prices
in Melbourne also eased, but to a lesser extent, and ended up in line with
values in Sydney.
In the West, the market
indicator dropped 9 cents over the week to 1289 ¢/kg. However, there was a
change of direction after the falls on Tuesday, with all MPGs rising by 3 to 15
cents in Fremantle on Wednesday. According to AWI, the strongest prices of the
day were achieved at the end, setting positive momentum for the following week.
Merino carding prices were the
only positive for the week, lifting 12¢ in Melbourne and Fremantle and 4¢ in
Sydney. A total
of 44,033 bales were offered up to the trade, and after a pass-in rate of 8.7%,
40,027 bales were sold. This represents an additional 2,559 bales sold compared
to the previous week.
While the wool market has seen
relatively low volatility compared to livestock prices in the past year, an interesting
question was posed on which microns experience the most price volatility. We
found that in proportional terms, price volatility increases as fibre diameter
decreases (read
here). This insight may be useful in determining a
price risk management strategy, although it is unlikely to impact enterprise
decisions significantly.
Volume rise rattles the market
Next week
A large offering is expected next week ahead of the easter recess. 49,814 bales are expected, which would be an extra ~ 5,000 bales compared to this week’s offering. These volumes are likely to pressure the market.
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Click on graph to expand
Click on graph to expand
Data sources: AWEX, AWI, Mecardo
Categories
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An update on oil and fibre prices
The continued blockade of the Strait of Hormuz and consequent fluctuation of oil prices (at elevated levels compared to 2025) has maintained the disruption to
Market eases on the back of tighter economic conditions
This week the Australian dollar (AUD) hit its highest rate against the US Dollar (USD) since May 2022, at 0.725¢, on the back of the
Merino RWS Premiums
In March Mecardo looked at how RWS premiums for crossbred wool had revived from their low levels of 2023-24. Given the magnitude of the rise
Prices flat as offering increases
The Eastern Market Indicator (EMI) fell relatively flat this week, up only 2¢ to 1897¢ after price rises for Crossbred wool and Sydney fine merino
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