THE Eastern Market Indicator (EMI) soared to new heights this year, recording the highest seasonal average ever at 1254 cents a kilogram.
The eight-per-cent contraction on last year’s national offering strengthened auction prices at the country’s three selling centres at Sydney (Yennora), Melbourne (Brooklyn), and Fremantle (Bibra Lake) where nearly 1.7 million bales were sold.
Prices eclipsed last year’s average by 157c/kg.
The year’s total number of bales sold included 483,577 at Sydney, 844,269 in Melbourne and 324,874 in Fremantle.
Following the Christmas recess, Week 30 recorded the highest national volume offered since 2010 when 59,775 bales, while the smallest national offering in four years was put forward in week 52, with 22,108 bales.
The highest price was paid in August 2015 when the EMI cracked 1304c/kg, before three more attempts to break-through the 1300c/kg barrier in May, before closing the season at 1297c/kg.
The season finished with an increase in Merino Fleece prices, despite global uncertainty surrounding the British referendum result to leave the European Union.
Australian Wool Exchange senior market analyst Lionel Plunkett said, relative to other sectors, the year‘s results indicated a Merino fleece renaissance.
“This season’s story is about Merino fleece types –in previous seasons we saw the crossbreds and Merino cardings perform very strongly, but this year it was Merino fleece types which closed well ahead for the year,” Mr Plunkett said.
“Crossbreds lost ground and finished 150c/kg cheaper than the start of the season, whereas those broader microns from 19-22m were 100c/kg dearer than the previous season’s closing value.
“This augurs well for our Merino producers and growers who have stuck to their Merino enterprises through thick and thin.”
Export giant Techwool Trading held its ground as the largest procurer of Australian wool, absorbing 13.4pc of the national clip, or 223,164 bales this season.
Chinatex overtook Fox & Lillie’s position as the second largest buyer of Australian wool, purchasing 9.5pc and 8.8pc respectively.
Despite securing 5.5pc, or 91,407 bales for the season, China-backed new player Global Wool Exports has been notably absent from the buying gallery in recent weeks.
Australia’s largest customer China recorded a drop of 10pc in volume from July 2015 to April 2016, to 193m greasy equivalent kilograms, or 70pc of the national clip.
The lower demand was absorb by Korea and India, who had an increase of 35pc and 8.5pc on last year’s volume to 14.5m and 20m gsy eq kg respectively.
Techwool Trading Export trade manager Josh Lamb said China’s wage inflation and economic challenges had influenced a shift in countries’ imports of Australian wool.
“Wool out of Australia to Korea is predominantly a carding product – the carding market is for the knitwear and sportswear sector which over the past three to four years has shown the most growth,” Mr Lamb said.
While India’s demand previously catered for domestic consumption, Mr Lamb said rising wages and economic challenges in China had resulted in Indian companies increasing their export focus this year.
“India has started focusing on the domestic market for top and yarn, and that side of their business is growing and that has increased the quantity they’ve taken,” he said.
“The rising costs of production in China have given the rest of the processing world a better level playing field.”
Landmark-Jackson of Geelong wool specialist Ted Wilson said sustained demand and tighter supply drove the market this season.
He said a supply shortage flushed significant wool reserves out last May and June, which contributed to the 8pc fall in demand.
“This season we have seen the seasons go bad so growers have been prepared to sell because they need the funds to feed and water stock,” Mr Wilson said.
“We also didn’t have the quantities of wool held back for later in the season.”