Uncertainty over fleece market's next move

Total uncertainty over Australian wool market's next move

Sheep
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Last week saw relative stability in the wool market for all industry participants, given the global pandemic of COVID-19.

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As the only nation with any volume of wool to transact, Australia is in the focal seat, however, COVID-19 has all industries unsure of what will happen next.

As the only nation with any volume of wool to transact, Australia is in the focal seat, however, COVID-19 has all industries unsure of what will happen next.

It was relatively stable in the wool market for all industry participants last week, given the global pandemic of COVID-19. No doubt the postponement/closure of the South African and New Zealand markets, making Australia the only source of auction supplies, has helped support the market.

This was reflected in the AWEX Eastern Market Indicator losing five cents a kilogram on Tuesday to then gain 7c/kg and 2c/kg on Wednesday and Thursday respectively, to close off at 1442c/kg.

The WA indicator lost 27c/kg and then gained 1c/kg, to close off at 1512c/kg.

Potential industry shutdowns would have overseas mills looking to shore up supplies in the short term, however, longer terms may not have nearly the same support from mills.

The Australian wool industry, as with many other essential services, has taken large steps to mitigate any risk of COVID-19 infections.

This has seen auction rooms moved out onto show floors, into dining halls and buyers/brokers spread out to adhere to the social distancing rules. What's more, the industry has investigated many other options such as interface 'Zoom' auctions and online auctions.

AuctionsPlus is set to start offering online wool auctions around early April.

Online last week, AuctionsPlus Wool saw consistent buyer inquiry with 477 bales selling throughout the week. Last week 16- and 18-micron fleece wool sold up to 1020c/kg and 1230c/kg (greasy) or 1594c/kg and 1687c/kg (clean). While 19- and 20-micron fleece wool sold up to 1160c/kg and 1140c/kg (greasy) or 1553c/kg and 1543c/kg (clean).

The top price lot sold online was a line 17-micron AAA Merino fleece wool, with 0.8 per cent vegetable matter. It was branded JI/TOMBONG, offered by Jemalong Wool and sold for 1225c/kg (greasy) or 1723c/kg (clean).

There is an estimated 39,000 bales on offer across the nation this week.

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