Australian Wool Sale Report – Commentary from AWI (22 April 2021)
Large rises on all Super Fine Merino types produced positive sentiment at this week’s Australian wool auctions. At the finest end of the Merino type spectrum, gains of 50ac and above were achieved throughout selling with the interest and competition in this area intense. Other areas of the Merino fleece type enjoyed smaller price advances not just due to the positive atmosphere created, but also steady enquiry and stable foreign exchange scenarios aiding in relative stability.
The Eastern Market Indicator (EMI) closed the week at 1312ac clean/kg which was 21ac or 1.6% higher than the previous weeks close. Mid-week the EMI did hit the 1318ac mark but a softer final day saw the indicator ease into the close. The USD EMI took the same path as a largely unchanged forex rate had US prices 1.6% or 16usc higher to close at 1012usc/clean kg.
The strong finish to the previous week’s sales at the standalone sale at Melbourne suggested this week may have been a positive sale, and that lead didn’t disappoint. Reasonable new business was able to conclude with China, but it was a few snippets of business outside China that also helped the market along. It is significant at present that a just a few containers of fresh sales unexpectedly outside China can immediately assist the market.
This week’s scheduled offering failed to materialize with over 5,000 bales or 11.3% less wool offered than advertised the previous Friday. Additionally next week’s offering has 25% or 10,000 bales more wool to be offered than was advised a week ago. Indications of improving wool demand is becoming a little bit clearer and as a barometer of this, there has been 13.4% or 138,733 more bales sold this season compared to the same point last season.
Super fine Merino fleece and skirting types finer than 18.5 micron enjoyed the best sale outcomes with prices being 45ac to 90ac dearer. 18.5 to 19.0 micron Merino wools gained 25ac, whilst a last day deterioration on 20.0 micron and broader Merino wool had losses of 5 to 15ac recorded for the series. This week’s price results have now extended the price gap between 17 micron and 21micron out to over A$10/clean kg.
After weeks of stability, the carding indicator pushed upwards this week and general gains of around 20ac on all types and descriptions were registered. Crossbred wool types remained stable in price throughout selling, with both the volume and quality of the offering down for the moment.
The final day of selling did see the market ease back across all wools broader than 18.5 micron. The FNF (less than 1%vm) sale lots were least affected, but buyers did show far less purchasing intent the broader the wools were.
There is almost 51,000 bales scheduled to offer next week.