AWI Commentary wool sales 24 September 2020
Wool prices continued their strong ascent this week at the Australian auctions. Pre sale news had all buyers expectant of a very significant rise. All types and descriptions were positively affected and recorded compelling gains of varying magnitude.
For the third consecutive week, the Eastern Market Indicator (EMI) added hefty improvements to wools general values. In AUD (Australian dollar) terms the EMI lifted 10.6% or 99ac to close the week at 1036ac clean/kg.
Overseas buyers using USD still paid higher prices but were less affected by as the AUD weakened substantially against the USD (US dollar) by 2.4%. The USD EMI levels were 7.9% higher or 54usc to close at 739usc cln/kg.
The new firm order business of the past three weeks has seemingly given export traders a new found aura of confidence from which to stimulate trade. All three auction centre purchasing were clearly dominated by the local buyers, with the Chinese indent operators and overseas top makers picking up minimal quantities only.
A smattering of European and Indian purchasing was evident but purchased volumes for those destinations remain relatively low. This week was a designated superfine sale week, and the premier Italians did not appear on buyers lists. The wool types on offer this week were largely unsuitable for Italian processors and this was probably the reason for their low buying numbers together with the current retail circumstances.
Coinciding with this new positive sentiment from the buying side, sellers have also managed auction volumes to extract the most out of an appreciating market by limiting the volumes up for sale each week. The national weekly volumes of sub 30,000 bales have aided in price recovery as the current demand has at least matched or exceeded supply.
Superfine (less than 18.5micron) Merino types were the most sought after again this week and all types appreciated by 130 to 180ac. Fine and medium (broader than 18.5mic) recorded gains of 100 to 120ac. Cardings added 50 to 60ac whilst crossbreds put on 20 to 40ac for the week.
Next week sees volumes jump up 43% from this week with all three auction centres in operation once more offering over 33,000 bales.