Australian Market Drops for Third Straight Week
March 15, 2019
The Australian wool market continued to track downward in Week 37, recording losses for the third consecutive series. The national offering reduced again this week to 40,785 bales. When compared year-on-year, the total number of bales offered has fallen by 176,192 bales – a reduction of 12.7 percent.
This week saw the market follow a similar pattern to the previous series. A diminishing supply of better style wools – in particular those possessing favorable additional measurement results – attracted excellent support and closed out the week achieving prices only 15 to 20 cents below the levels achieved in the previous week. However, there was again an ever-increasing supply of lower style/lower yielding types. The national average yield on merino fleece was only 63.6 percent dry – the lowest level in more than 10 years. Buyers continually reduced their basis on these lower yielding wools, as they again struggled to average them into their purchases.
By the end of the series, these types were generally 30 to 50 Australian cents cheaper. The large reductions in these wools was the major factor in the individual Micron Price Guides falling as far as they did. On the back of these falls, the AWEX Eastern Market Indicator lost 29 cents. It fell back below the 2,000-cent threshold, closing the week at 1,979 Australian cents.
The lower price levels were met with firm seller resistance, this resulted in a passed in rate of 12.6 percent – the highest figure since November. The crossbreds also lost ground as 26.0 to 30.0 micron were generally 25 to 40 Australian cents easier.