Tight supply boosts wool prices

The AWEX Eastern Markets Indicator (EMI) hit 1153 cents a kilogram last Thursday, up 23c/kg on the week prior.

The northern markets recorded a 18c/kg boost, hitting 1175c/kg the same day.

Schute Bell Badgery Lumby Sydney wool manager Gerard Buchanan, Sydney, said the market kick had been positive and was being driven by supply concerns.

"It's across all micron indicators, which has been the pleasing thing," he said.

"There is a concern about supply and where supply is going to be in the next couple of months and in the short term."

Some of the big movers included 17-micron wool which was up 24c/kg in the Sydney sale to 1382c/kg, 16.5-micron wool was up 26c/kg to 1400c/kg while 19.5 micron had risen 32c/kg to 1274c/kg, 22-micron wool jumped 33c/kg to 1192c/kg.

Mr Buchanan said many graziers had shorn their sheep early, and then sold the stock due to the dry, which meant supply could be tight until the end of June.

That said, he didn't think the market would continue to rise at the levels it had been.

"I can't see the 20c/kg to 30c/kg rises a day or week being sustainable over a longer period of time."

Rather he thought the market would steady at its current level.

"I don't see the market falling away too dramatically, but I can't see it going onwards and upwards continuously either," he said.

"I think we might see the market stabilise and settle back a little bit.

"In the past two to three weeks most buyers have been active and that's been a big change."

Previously the market had been "hand to mouth", with buyers coming in and out depending on orders.

"But when you have weeks like we have for the past two to three sales, there are consistently more buyers in the market.

"And obviously the bidding intensifies in the room due to more people on it - so it has been a positive couple of weeks."

Mr Buchanan said the Australia dollar sitting at about US77c was also playing its part in the buoyant market.

"Our currency is playing a positive role, compared to where we were three or four months ago."

He said despite the high prices across the board, the quality of the wool was up and down and dependent on the region it came from.

"You've got wools out of the Monaro which are quite good and beautiful and bright white.

"But others are showing signs of the seasonal conditions."

Elders district wool manager Samantha McPhee, Crookwell, said the crossbred and carding wools had been selling fantastically.

"The demand for crossbred wool has changed, a lot of it goes to knitwear, but now it also goes to weaving fabrics," she said.

"We are seeing a big pull in production for that line of products."

Ms McPhee said the discounts for strengths and midpoint breaks had also disappeared in the past week.

"The premiums for high strength and low midway breaks have disappeared as well which is allowing all types of quality of wool to sell."

She said it was the sixth consecutive week the market had increased across all three selling centres.

"We expected it to drop and coast along last week, but it had another kick," she said.

"Whether we get another kick next week I'm not too sure, but I can see it going back to coasting along."

Ms McPhee said it was a good time for growers to consider forward selling and locking in prices for the end of the year, especially for crossbreds.

"They normally are 50 per cent of the clip and it's a good insurance and because prices are so good at the moment."

Time to sell at Narromine

SHEARING has finished at Patrick White's property at Narromine for the year.

The 19- to 20-micron wool is set to be sold in Sydney within the next week and Mr White is hoping the market stays buoyant until it does.

"As long as we can average a bit over $1000 a bale we are happy, about $1200 a bale is a good result," he said.

"But even a few cents a kilogram, even 50c/kg can make a big difference across 50 or 60 bales."

This year 1800 sheep were shorn on "Alvaholme" with the 51 bales of wool sent to Schute Bell Badgery Lumby for sale.

Mr White runs the property with his wife Leanne, three children, and his parents, Patrick (pictured) and Gail.

They run a mixed farming operation, cropping wheat, canola and barley, as well as running a self-replacing Merino flock and trading sheep.

This year they joined their Merino flock to Dohne rams.

Mr White said while they were looking to keep a foot in the wool market door, they were chasing bigger-framed sheep for the meat market.