Positive sentiment boosts Australian wool auctions this week

Improved foreign exchange (forex) rates contributed to better price returns for growers, and lower volumes on offer also influenced manufacturers' decision-making. The next three weeks are expected to see average weekly sales drop to less than 30,000 bales, with the Western Australian wool selling centre in Fremantle not offering wool in week 49 and also sitting out week 51 due to insufficient volumes to hold a commercial sale, the Australian Wool Innovation (AWI) said in its commentary for week 48 of the current wool marketing season.

The diversity of Merino wool types on offer is notable, with many clips in the 18.5 to 21-micron range containing higher vegetable matter (VM) levels of 2.5 per cent to over 5 per cent. This allows top makers and traders to seek value by trading away from mainstream types. These higher VM clips are currently finding strong support, as the VM within the fleeces is relatively easy to comb.

This trend is reducing the percentage of weekly supply of 0.1 per cent to 2 per cent VM sale lots, placing upward price pressure on these lower VM clips. Standard contracts from China still require VM levels to average 1 per cent for fleece types, and main volume customers from India have similar specifications for completed orders.

Within the Merino fleece sector, general price gains ranged from 10 to 20 cents per kilogram clean. Notably, premiums were observed for better-specified and more stylish superfine (less than 19 microns) sale lots, traditionally suited to the European market. These few lots offered this week sold at approximately 140 cents per kilogram clean above the standard types, the AWI commentary added.

Next week's auctions will see around 27,500 bales up for sale on Tuesday and Wednesday, but only in the eastern selling centres of Sydney and Melbourne, with Fremantle not participating.

Fibre2Fashion News Desk (KD)