Merino wool ends the week down 30 cents

Merino wool ends the week down 30 cents


Analysis
The sentiment at physical auction was reflected online, as there were no sales on AuctionsPlus wool this week.

The sentiment at physical auction was reflected online, as there were no sales on AuctionsPlus wool this week.

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Following a spike in prices, the wool market experienced a slight decline last week.

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Following a spike in prices, the wool market experienced a slight decline last week with most micron price indicators down across the two selling centres.

Some of the reluctance of buyers was attributed to the quality of wool on offer, with a large amount of high vegetable matter and low strength wool, as the current seasonal conditions across most of Australia continue to have an effect.

Follow-up rain is desperately needed for much of the NSW Central West, North West and parts of Queensland, with these areas looking at a dry winter as no signs of relief are forecast.

Reports from physical auction, with Fremantle having a week off due to supply, suggested buying at the start of the first day at the southern centre was slow, but picked up as buyers sought quantity given the reported supply pressures.

This momentum reportedly slowed on the second day, as large quantities of the lower quality drought affected wool were discounted.

It was also reported the northern selling centre saw strong buyer support for the better style wools, but the poorer styles were heavily discounted.

This was backed by the AWEX Eastern Market Indicator as it fell 7 cents on Wednesday and then a further 16c on Thursday to reach 1864 cents a kilogram, with a pass in rate of 15.5 per cent.

The largest falls came for 18 to 20-micron wools as large amounts of the finer wool types were discounted, leading to the Merino wool indicators having mixed results across the three selling centres, but largely ending the week down 30c.

The sentiment at physical auction was reflected online, as there were no sales on AuctionsPlus wool this week.

This week there are close to 30,000 bales on offer and the Fremantle selling centre is open again. With supply pressures and the tough season continuing, it is expected the market will continue along the same path as last week.

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