Australian Wool Market Continues Negative Slide
November 2, 2018
The Australian wool market continued its slide into negative territory in Week 18. Buyers were again tentative in their bidding, as a result the market struggled to find a solid basis. The lack of buyer confidence – combined with an ever-increasing quantity of lower yielding, lower strength wool – resulted in losses across the board.
By the end of the sale, the prices being realized were generally 15 to 40 cents below those achieved at the previous sale. The AWEX Eastern Market Indicator lost 20 cents for the series, to close at 1,854 Australian cents. During the previous three sales, the EMI has dropped by 169 cents. The EMI has now fallen 262 cents from the record achieved in mid-August. This equates to a reduction of 12 percent.
The fall in prices was again met with firm seller resistance, resulting in 16.7 percent of the national offering being passed in. Combined with the 8.6 percent that was withdrawn prior to the sale, this meant that the clearance rate for the week was only 74.7 percent.
The skirtings were the best performing sector of the week, managing to record modest gains of between 5 and 10 cents. Wool carrying less than 2.0 percent vegetable matter attracted the most competition and the largest gains. The crossbreds had a week of mixed results as prices rose slightly in the south and fell slightly in north.
The oddments continued their steep downward path. Locks, stains and crutchings generally fell by a further 40 to 100 cents, pushing the three carding indicators down by an average 71 Australian cents. During the course of the previous six sales, the merino carding indicators have fallen by an average of 468 Australian cents.
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