The Eastern Market Indicator dropped 10¢ over the week to 1,129¢/kg, settling once again at the levels of four weeks ago. The market faced a similar fate in the West, with the Western Market Indicator losing 11¢ to end at 1255¢/kg. The AUD depreciated 0.54 US¢ to 63.31 US¢ but staged a bounce to 64¢ on Thursday after the wool sales were complete for the week.
Wool with favourable additional measurement results received very strong buyer interest and held their ground according to AWEX. However, anything outside this bucket was discounted this week which overall dragged the MPG’s lower for almost all microns in all markets.
Fine Merino and crossbred wools showed the most resilience this week.18.5 MPG and finer in Melbourne dropped 5-12¢, 17.5MPG was the exception, posting a 7¢ lift this week. Medium fibres in the south lost 12-26¢ this week while 19.5MPG in Sydney came under more pressure and dropped 32¢.
Crossbred prices remain at their new, higher levels which is encouraging selling. There was no change to crossbred prices in Sydney while in Melbourne they lost 2-5¢ on the week.
This week’s offering of 44,378 bales was 5,354 bales more than the week prior. A slightly higher pass-in rate this week of 9.4% meant that 40202 bales were sold to the trade which is the highest volume since August. The fact that clearance rates remain high and wool on hold is steady tells us that cash flow is the priority in most livestock enterprises at the moment. Much weaker livestock values might have something to do with it.
Looking further out to the 2024/25 season, current levels of sheep offtake that the Australian flock is set to contract this season. This means lower sheep numbers in 2024-25 for slaughter and a lower wool supply, although exactly how this affects wool supply will depend on changes to the different sheep categories of the flock.
Wool supply heading higher
Next week
Southerner’s will have their holiday for the Melbourne Cup on Tuesday next week which means sales are set for Wednesday and Thursday. Another large offering of over 45,000 bales is on the roster.
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Data sources: AWEX, Nutrien Ag Solutions, Mecardo
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