Cautious Buyers Gauge Return of Australian Market
August 10, 2018
Australian wool sales resumed this week after the annual three-week, mid-year recess. The break in sales resulted in an increased offering of 49,415 bales.
Selling opened on Tuesday with only Melbourne and Sydney in operation. The buying approach could best be described as cautious, as buyers attempted to gauge the market. The lack of buyer confidence resulted in general losses of 10 to 40 Australian cents, with wools coarser than 20.0 micron most affected.
The downward direction of the market was short lived, however, as buyer confidence returned on the second selling day and continued unabated to the final lot of the Fremantle sale. Main buyer interest was focused on wools 19.0 micron and finer, pushing these types up by 40 to 90 Australian cents for the series. The coarser microns did not fare as well as their finer cousins. In Sydney and Melbourne, 21.0 micron and coarser fell by 10 to 30 Australian cents for the week. The benchmark Eastern Market Indicator recorded an overall gain for the week of 9 cents, pushing it to 1990 Australian cents.
The crossbred sector suffered price corrections this week on the back of reduced demand. Most affected were 26.0 to 28.0 micron, dropping 50 to 90 Australian cents. Poorly prepared lines had noticeably less support and recorded the largest falls.
A limited selection of 32.0 micron managed to hold up well, recording little change. The skirtings came under intense pressure, as buyers fought hard to secure meaningful quantity. Prices generally rose by 40 to 80 Australian cents, with wools carrying less than 3.0 percent vegetable matter enjoying the largest gains. Locks, stains and crutchings all rose for the sale by 15 to 30 Australian cents. This was reflected in the three carding indicators rising by an average of 20 cents.
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