IWTO Treated to Feature Wool Auction
April 8, 2016

Wool prices surged this week as buyers paid more than $64.3 million to secure supplies as the 85th International Wool Textile Organization Congress was held in Sydney. Close to 500 IWTO delegates were treated to this feature wool auction.

The Australian Wool Exchange's Eastern Market Indicator lifted 31 cents to 1270c/kg clean, with the EMI in US$ terms lifting 24 cents to US968c/kg as the Australian dollar appreciated slightly to US76.25 cents.

Good results in the two weeks prior to the Easter recess provided a strong platform going into the sale, contributing to a surging market. There were expectations of a healthy market among sections of the trade; however, the size of the gains caught many by surprise.

Tight supply and supply chain length are key factors. There is so little greasy wool in the supply chain that buyers need to return to the market to buy stocks, commented brokerage manager Eamon Timms.

Increases of 60 cents were common by the end of the second day before the rally lost momentum and prices eased back 10 cents at the close of the week. During the sale, buyers displayed a strong appetite for the 19-micron and broader range wools, especially the limited-quantity wools around 22-23 microns. This support spilled over into the finer crossbreds (25-26 microns), which were as much as 70 cents higher.