Excitable market attributed to supply issues

Excitable market attributed to supply issues

Wool
This week's auctions will indicate if the upward trend will continue, or if the past week's results have overstepped the mark for the short term.

This week's auctions will indicate if the upward trend will continue, or if the past week's results have overstepped the mark for the short term.

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Large gains were seen across all types last week, with the Eastern Market Indicator finishing up at 1594 cents a kilogram.

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Large gains were seen across all types last week, with the Eastern Market Indicator finishing up at 1594 cents a kilogram.

This equates to a gain of 49c/kg, or a rise of 3.2 per cent. In US dollar terms, the EMI sits at 1104c/kg.

The 17-micron wool saw the highest gains, rising 70c/kg to finish the week at 1992c/kg.

Following a few weeks of relative stability in the EMI, this dramatic rise in price has been viewed negatively by some, calling it an overreaction and a reflection of the sensitivity in the current market.

The main reason for the current excitable market is likely the ongoing supply issues. Australia's adverse climate conditions are reflected globally, leaving supply much lower than forecast. Typically, a drop in supply would lead to higher prices, but it appears global uncertainty may be counteracting this.

A total of 35,300 bales were offered last week, with a passed-in rate of 6.7pc.

Looking online, 760 bales sold for the week, with 89 different grower brands finding buyers.

Online, 16 and 17-micron fleece wool sold to a top of 1304c/kg and 1480c/kg (greasy) or 1816c/kg and 1907c/kg (clean). 18 and 19-micron fleece wool was the most popular online this week, comprising 43pc of all purchases and sold to a top of 1361c/kg and 1345c/kg (greasy) or 1847c/kg and 1818c/kg (clean). 20 and 21-micron fleece wool sold to a top of 1305c/kg and 1205c/kg (greasy) or 1795c/kg and 1769c/kg (clean). 77 bales of crossbred wool and fleece sold to a top of 1078c/kg (greasy) or 1441c/kg (clean).

The top priced lot sold online this week was a line of 17.8-micron AAAM Merino fleece wool, which had 1pc vegetable matter, and was 81 millimetres in length. It was branded GREENBROOK, offered by WGM wool and sold for 1480c/kg (greasy) or 1907c/kg (clean).

There are 36,000 bales to be offered next week.

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