Wool Prices Continue to Rise – Especially Super Fine and Fine Wools
March 17, 2017
The benchmark Australian Eastern Market Indicator continued to explore new heights, adding an additional 26 Australian cents to its historical high point, finishing the week at 1546 Australian cents. The recent trend of micron becoming a major influence on buyer activity continued with finer microns experiencing the most significant price movements, in particular 18.5 and finer, which experienced gains of between 60 and 100 cents. The large price movements in the finer microns continue to widen the micron-price differentials, with the price difference between an 18.0 and a 21.0 micron being nearly 700 cents.
The record prices have gradually brought previously unwilling sellers to the market, pushing the amount of wool being held in broker’s stores to historical lows. The lack of wool on hold has severely limited any large increases in weekly quantities, enabling the market to gradually rise without any extra supply pressure and this week’s sale was no exception. With clearance rates consistently in the 90-percent region, the amount of wool on hold will continue to stay at these levels.
To assimilate this information to the U.S. wool market, it would be accurate to say that the wool market is stronger this year over last with the help of China again being active in the U.S. market. However, the overall market indicator shows that the rise in the market is largely due to the significant increases in the 20 micron and finer wool with all other wools experiencing less growth.
Producers should be aware that sorting off the finer micron wools could have a greater value this year than it has in the past several years with the micron of the wool accounting for such a large price-spread at market.