Australian Market Slides in Season's Final Sale

The Australian wool market continued its steep, downward path this week as lack of buyer confidence pushed prices lower for the fourth consecutive week.

In the final sale week of the 2018-19 season, the national quantity was 29,167 bales. The overall reduction in auction offerings compared to the 2017-18 season was 225,182 bales - a fall of 11.9 percent.

The market opened softer and continued to drop as the week progressed. Better-style, well-measured wools were generally 70 to 100 cents easier. The lesser-style wools and those with poor additional measurement results were even harder hit - up to 150 cents cheaper - as buyers looked for value in the continually falling market.

The AWEX Eastern Market Indicator fell by 51 cents for the series, finishing the season at 1,715 Australian cents. The EMI fell at all four June sales, losing a total of 172 cents during this period. This is second-highest monthly fall in the EMI ever - the largest was in March 1991 when the Reserve Price Scheme was abolished. In percentage terms the EMI lost 9.1 percent for the month - the largest monthly fall since August 2012 (when it fell by 12.1 percent).

The skirtings also dropped sharply, generally 50 to 100 cents. Wools carrying more than 5 percent vegetable matter were most affected. The crossbreds recorded falls, but not to the same extent as the merinos. The crossbreds generally eased by 30 to 50 cents.

The first sale of the new season is traditionally one of the larger sales for the year, as growers looking to sell in the new financial year take the first opportunity. This year, however, the sale is smaller than normal, perhaps due to the deteriorating market. Currently there are 34,504 bales rostered for sale in Sydney, Melbourne and Fremantle.

Source: AWEX