Correction Hits Australian Wool Market
January 26, 2018
The Australian Wool Market has continued to track downward this week after losses experienced at the previous sale. Buyers were again more selective with their purchases, and the result was wools with unfavorable test results struggling to find support in the falling market.
Lots with high mid-breaks became almost unquotable as they lost buyer interest. Conversely, wools with low mid-breaks attracted intense competition and the result was that some recorded little change in price. The hardest hit were 18.0 through to 20.0 micron as prices were generally reduced by 30 to 80 Australian cents.
The Benchmark Eastern Market Indicator fell by 57 Australian cents, the largest weekly fall in the AWEX-EMI since June 2015, to close at 1744 Australian cents. Worth noting is that a stylish selection of 17 micron and finer resisted the falling market and managed increases of 5 to 15 Australian cents.
The skirting sector was dependent on vegetable matter – the higher the vegetable matter, the greater the reduction in price. The crossbred sector also suffered large corrections. Any lines that were poorly prepared lacked buyer interest and suffered heavy discounts. Prices generally fell by 40 to 80 Australian cents. The exception was 32 micron and coarser, which were only 10 to 20 cents easier. The oddment market was the fastest climbing sector during the past three months.
Records were set and broken in a continual upward cycle. Many pundits believed that the sector was overpriced, and last week saw a significant correction. That said, nothing could have prepared the trade for the free fall in prices of this sale. Carding prices were continually reduced, by the final hammer the fall in price was 150 to 250 Australian cents.