Stronger prices were seen across the board this week at the Australian wool auctions. Prices began to head up from the opening lot and then gathered momentum throughout selling to close the week at the highest point. All sections of Chinese industry were active as were a few European orders from both forward sellers and indenting top makers.
The Eastern Market Indicator (EMI) added 47ac or 5.3 per cent to push to 937ac clean/kg. Even more promising is that the USD EMI by the close hit levels of 6.5 per cent higher or 42usc to 685usc clean/kg. That extra one per cent gain came about due to a stronger AUD against the USD, a movement which can usually act bearishly upon a market, the Australian Wool Innovation Limited (AWI) said in its commentary for week 12 of the current Australian wool marketing season.
“The confidence that has buoyed the market for the past two weeks has largely arisen from fresh business opportunities and conversion of that interest and enquiry into firm orders. Prior to last week, the auction scene had been deprived of any spark of optimism for a six-week period,” the AWI commentary said.
“During that time (the six-week period), speculative stock buying was near to non-existent and the limited volume of contracts needing to be shipped had been easy to fulfill. Buyers were given very little reason to push to buy as business was slim to nothing as the market fell to the lows of 858ac two weeks ago. That buy in level has not been available to manufacturers or traders since the end of November 2009,” the commentary added.
Superfine (less than 18.5 micron) merino types were the most sought this week and all types appreciated by around 100ac. Fine and medium (broader than 18.5mic) merino descriptions were by no mean neglected and recorded gains of 45 to 60ac. Skirtings followed a similar price rise trend as their fleece counterparts. Cardings and crossbreds gained 30ac for the week.
Many positives arose this week, but the strength of the WA Fremantle market was the standout. Most of the wools there sold above and beyond that of the Eastern Australian centres to the order of 5 to 20ac. These results flowed on from the strong finish prior in Melbourne and Sydney which had some individual lots well over 100ac dearer for just the day.
All three auction centres will be in operation next week, but Fremantle will operate on Wednesday only. Around 25,000 bales would be on offer at the auctions.