Australian Wool Season finishes low
The Australian wool selling season has finished on an expected low. The industry has experienced the most challenging conditions with demand for all wool types plummeting due to Covid-19.
AWIS weekly newsletter reported that the AWEX EMI finished at 1110¢, 29¢ lower
(-2.5%) in Australian currency and 13¢ lower (-1.7%) in US currency in the last sales of the season in Sydney, Melbourne and Fremantle in Week 52.
28,029 bales were on offer nationally, compared with 15,800 bales last sale. 11.5% of the offering was passed in after 6.8% of the potential offering was withdrawn prior to sale. 24,804 bales as sold. It was the lowest Withdrawn Rate since mid-March.
AWEX reports that the value of the wool sold was $31.7 million ($1,278 per bale), taking the season total to $1.948 billion ($1,616 per bale).
Year-on-year the EMI has fallen 605 cents or 35.3 per cent and in US dollars a 428c fall, or 35.8pc lower.
The report also published Australian Bureau of Statistics (ABS) latest export figures from July 2019 – April 2020. These figures are as follows:
- Australia exported 25 mkg of wool valued at $233 million in April, taking the progressive totals to 206 mkg, (-16.1%) and $2,190 million (-33.1%).
- Exports to China were down by 7.1% in April and down by 14.5% in the July to April period. They accounted for 93.0% of Australia’s exports in April and for 78.7% in the year to date.
- China’s share of 93.0% for the month of April reflects the impact of COVID-19 on the distribution of Australia’s wool exports.
- India and Italy retain their positions as Australia’s second and third most important destinations by weight for Australia’s progressive wool exports, with 5.8% and 4.5%, respectively, of Australia’s wool exports going to these countries in the year to date.
- 84.8% of Australia’s exports of wool of 19 microns and finer went to China and 4.1% went to Italy.
The total national offering has seen a reduction of over 11pc with just 1,470,717 bales offered. This was 194,942 bales less than the previous season. As expected, the total turnover year-on-year fell dramatically, dropping $1.219 billion from the previous season which was $3.192 billion. The national passed in rate finished 6.5pc higher than the previous season, all due to falling prices.
The familiar names continue to be the biggest wool buyers in the last season. Techwool Trading, founded by Rod Franklyn in 1983, remains the largest buyer of Australian wool in the 2019/20 season. It bought 173,000 bales of wool (to the start of June 2020). 70% of this wool was exported to wool mills in China. Second place was taken by Endeavour Wool, a relatively new company started by Josh Lamb, Warwick Eddington, and Stuart Greenshields some three years ago. It bought 128 bales, again mostly destined for China.
Other main buyers dominating auction and private buying include United Wool, established in 2013 by Matt Hand, Nigel Rendell, and Andrew Jackson, as well as Michell, Fox & Lillie, Australian Merino Exports, and PJ Morris.