Prices at Australia's physical wool auctions last week continued to decline, as the brief confidence in the market that was evident the previous week disappeared and external economic factors continued to bring uncertainty into the sector.
The Australian Wool Exchange (AWEX) Eastern Market Indicator (EMI) dropped below 1000 cents a kilogram for the first time in eight years.
The EMI was down 25c/kg on Tuesday last week and then fell a further 34c/kg on the Wednesday to find a home for the week at 945c/kg - or 685c/kg in US Dollar terms.
The indicator is now at its lowest point since October 2012, and is down 552c/kg from the same time last year - as the coronavirus continues to wreak havoc on the world's economies.
There were 33,176 bales on offer at auctions in Sydney, Melbourne and Fremantle last week and a 25.7 per cent pass in rate.
This pass in rate was up 17.5 per cent from the previous week, as growers are becoming increasingly reluctant to sell their woolclips at the reduced prices.
The AuctionsPlus online offer board was used marginally, with buyers appearing to be sitting tight as the market continues to slide.
A total of 19 bales were purchased across two different lots, to see 20-micron Merino fleeces sell for 680c/kg (greasy), or 1069c/kg (clean). This lot, offered by Elders wool, had 1.5 per cent vegetable matter, a staple length of 104 millimetres and was branded as Glendale.
The other line to sell was nine bales of 16-micron Merino pieces, which reached 776c/kg (greasy), or 1429c/kg (clean). It had 8.5 per cent vegetable matter, a staple length of 74mm and was offered under the brand Brooksdale/F by Elders wool.
Looking ahead, there are about 22,346 bales scheduled to be offered this week at Sydney and Melbourne auctions - as Fremantle does not have a physical auction sale.
The AuctionsPlus offer board has been used frequently this week, with a total of 183 bales selling.
The market may have been over discounted and many buyers may be looking to capitalise on the cheaper market.