Positive start for wool market

Positive start for wool as buyers return to market

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Wool market starts new financial year on positive note as buyers return to market.

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After a demoralising five-year season low, the Australian wool market started the new financial year on a more positive note with a sprinkling of buyers making a welcome return to the market place.

The AWEX Eastern Market Indicator (EMI) rose six cents to close the first selling week at 1116 cents per kilogram, clean.

The rise, according to the AWEX market report, was off the back of steady demand for Merino fleeces with many woolgrowers taking the opportunity to sell in the new financial year, and were content to meet the market.

Australian Wool Network (AWN) state manager Victoria, Kelvin Shelley, said the rise was also thanks to more activity creating competition in the market place.

"We had more activity from individual exporters that haven't been active in the last two to three months," Mr Shelley said.

"Overall it wasn't large quantities that they purchased, but it was good to see them back in the market place - is a little glimmer of hope.

Overall it wasn't large quantities that they purchased, but it was good to see them back in the market place - is a little glimmer of hope - Kelvin Shelley

"Two of those return exporters were European, which is something that the market has certainly missed in the last few months."

Individual microns increased across the country by three to 27c except for 16.5 and 17-microns in the north market which both lost six cents.

Mr Shelley said there was extra business conducted on Thursday night, mainly out of China.

"There was business in Merino fleeces in a majority of microns, but there was some crossbred business as well," he said.

"Crossbred fleeces, which at the moment are extremely difficult to sell, but on Thursday we had increases of about 20 to 30 cents overall on the better crossbred clips, and Thursday night we had some sales there too."

The fact that there is only one week left to sell before the recess may have also played a part in the increased interest, Mr Shelley said.

"Hopefully we can finish next week on a positive note. It would be good going forward into the break," he said.

"It gives opportunity to the exporting companies to do a little bit of business.

"This year is the first year they won't travel overseas. Normally the July period is when they make their way overseas and book up as much business as they can from that July period right through to delivery around Christmas and the New Year, but this year they will be doing it all from home."

Mr Shelley said the drop in the price may mean it is now at a level where it can be incorporated back into processing lines

"Some of the prices are going to be absorbed by them in the near future, but it is all dependent on retail sals out the other side over the next six to 12 months," Mr Shelley said.

"These prices can definitely make it work, but the ones 12 months ago they would have possibly struggled with.

"If our EMI, going forward, could be around 1200 or 1300c as an average, that would be pretty attractive to most people, even growers."

This week is the final sale before the annual three-week July recess with the national offering increasing to 36,712 bales.

Due to the small quantity on offer, Fremantle only requires a one-day sale, Melbourne and Sydney will operate on both days.

The story Positive start for wool market first appeared on Farm Online.

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