AU Wool Sales Present Poor Results, Currency Exchange up to 75 Cents
March 11, 2016

Australian wool prices fell to a four-month low as the Australian dollar rallied against U.S. currency this week.

The Australian Wool Exchange-Eastern Market Index closed down 35 cents to 1223c/kg clean, with the Australian dollar lifting US1.81 cents during the week to US74.83. It was the largest fall in the AWEX EMI in six months. However, when converted to the choice of currency for most traders (U.S. dollars), the indicator barely moved, easing a modest 3 cents. That result was due to a strong rally in the Australian dollar, which jumped 1.8 cents on the back of a 1.3 cent gain last week. The rise in the currency this week came after a jump in base-metal prices, and at one stage, traded above 75 U.S. cents - an eight month high.

The effect on wool prices was fairly dramatic with all of the Micron Price Guides plunging 30 to 40 cents. Despite the magnitude, the downturn was reasonably orderly with prices dropping an equal amount each day. Buyer favoritism still prevailed for selected better types and reductions for these types were not as great as the lower spec types.

Reprinted in part from Weekly Wool market Report -- AWEX