Wool auction sales take a tumble as buyer demand slows

Prices at Australian wool auctions have faltered across almost all types and descriptions, according to Australian Wool Innovation’s latest weekly market review and update report. AWI trade consultant Scott Carmody said the apparent buying urgency that existed during the last few sale weeks quickly dissipated upon the opening of last week’s national wool sales. “Buyer actions were very much subdued in comparison to the last few weeks, with the market largely reliant upon the larger exporters and manufacturers to soak up the quantity on offer,” he said. “Since the close of selling from the previous week, the major forex rate of Australian dollar versus the US dollar had traded well into the mid 0.65s and above. “This initiated a softening for prompt and close in demand for shipment and any chance of fresh orders for month-out and beyond contracts that quickly evaporated.” Mr Carmody said coinciding with the above was the completion of traders’ forward orders for April shipment. “This allows exporters a few weeks of opportunistic buying for executing their next requirements, which are their May shipments — hence purchasing pressure was released and the market price reacted negatively,” he said. “As prices lowered, Chinese top makers and indent buyers increased their buying. “The fine and medium wool Merino sectors were again the most well sought in a tougher environment for sellers.” Mr Carmody said these wools were generally 5¢ cheaper at the broader 20.5 micron end of the scale, and 20¢ cheaper for 19-20.5 micron. “The superfine Merino (18.5 micron and finer) were again hard to place and losses of 25-40¢ were commonplace,” he said. “Crossbreds were slightly dearer with cardings and skirting types all 10-15¢ lower.” This week has more than 41,000 bales rostered to sell at Sydney, Melbourne and Fremantle.