Wool market maintains a steady climb

This week, 36,473 bales were sold, with a pass-in rate of 5.1%, Moreover, currency fluctuations influenced market dynamics. A weaker Australian dollar on day one saw the USD EMI drop 8 US cents, but a stronger AUD on day two pushed it up 9 US cents to 787 US cents—up 1 cent for the week. This week’s trade disruption in the form of Liberation Day presents global trade with a lot of short-term uncertainty, particularly on the currency front. Buyers looked to make the most of the current moment, which helped to drive demand.

Fremantle led regional gains, with all wool categories showing strong performance, notably the 18 and 18.5-micron categories, which both rose by 35 cents to standout levels. In contrast, eastern markets experienced more modest increases, with Sydney’s 19.0-micron climbing 11 cents to 1,561 cents, while Melbourne’s 18 MPG was the highlight, rising 7 cents to 1,627 cents.

Crossbred wools showed smaller improvements, with 28 micron in Sydney up 5 cents to 435 cents and Melbourne up 8 cents to 445 cents, reflecting steady but less aggressive demand. Merino Cardings (MC) were mixed. Melbourne dipped 1 cent to 745 cents, while Fremantle fell 19 cents to 751 cents, indicating softer interest in this category.

This Week in Mecardo, Andrew Woods analysed forward wool pricing and more broadly explored how hedging can benefit producers. He found that hedging is typically costly for growers, despite its potential to manage price volatility risks. He concluded that effective hedging requires identifying offsetting benefits, such as price stability, or securing premiums for higher-quality wool.