Coronavirus crisis: COVID-19 sends Australian wool market plummeting

The global coronavirus pandemic has ravaged the Australian wool market, plummeting almost 100¢ this week in the wake of the Australian dollar’s “dramatic depreciation” amid the outbreak.

Yesterday, the Eastern Market Indicator closed a 83¢ down at 1438¢/kg clean with Fremantle, Melbourne and Sydney’s wool selling centres all recording falls.

“A week’s price loss of 5.5 per cent is never good,” Australian Wool Innovation trade consultant Scott Carmody said.

“But when other markets were losing that percentage value in half a day throughout the week, the result at Australian wool auctions wool looks on face value as relatively strong.

“However, the real story from this week revolves around the US dollar ascending into stratospheric levels against the Australian dollar.

“The dramatic depreciation of the AUD by over 13 per cent effectively masked the heavy price erosion of our product in real terms.

“Over 70 per cent of wool is traded using foreign currencies, all of which have appreciated by 10.5 per cent to 13.7 per cent against the Australian dollar on a week to week comparison.”

It came as the Western Market Indicator slumped to 1538¢/kg after dropping 78¢ at Bibra Lake’s Western Wool Centre.