Australian Market Drops During Wool Week
August 24, 2018
This week was the annual Wool Week in Australia. The Western region had a one-week recess to allow interested parties to attend the planned activities in the Eastern states. An unusual selling pattern of Tuesday and Wednesday selling days in Sydney and Melbourne was also a direct result of Wool Week activities on Thursday.
Quantities reduced again this week – due in part to the Fremantle recess – resulting in a national offering of 29,691 bales being made available to the trade. Despite the reduction in quantity, the market could not sustain the rapid upward momentum experienced during the previous sales.
Buyers adopted a much more cautious approach, resulting in price corrections across the entire merino spectrum. The losses felt in the merino sector were generally 60 to 90 Australian cents. The lesser-style types and wools with less favorable additional measurement results were the most heavily discounted.
Due to the price reductions, the benchmark Eastern market indicator lost 48 cents off the record high it achieved at the previous sale, closing the week at 2,068 Australian cents. Worth noting is the fact that currency movement had a significant impact again this week. When viewed in U.S. dollars, the EMI did not record the same large movements and fell only 18 cents.
The skirting market also tracked downward this week. Prices were generally reduced by 40 to 70 Australian cents, with the losses felt across all types and descriptions regardless of style or vegetable matter content. The crossbreds also suffered corrections but not to the same extent as the merinos. The losses were generally 15 to 25 Australian cents with all types and descriptions recording a similar fall.