Another tough selling week

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Bob GarnantCountryman
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It was another tough wool market last week as prices continued heading south under pressure from low global economic confidence.

The Eastern Market Indicator finished at 1104 cents/kg clean, down 1.5 per cent.

Australian Wool Industries Secretariat's Peter Morgan said the EMI followed a familiar pattern of recent weeks.

"The soft demand and falling prices in US currency were cushioned by any further devaluation of the US exchange rate," Dr Morgan said.

He said the AWEX regional indicators finished 1.4 per cent lower as the US exchange rate fell by 2 per cent.

Kojonup wool grower Tim Johnston, who farms with wife Jo, said he was pleased his 18.4 average micron clip sold above expectations through the Primaries catalogue.

Mr Johnston attended the wool sale with wool classer Lowanna Jury, who classed the Johnstons' Chapel Estate clip.

Primaries director Matt Pedersen said wool classers were always welcomed to witness how the sale process worked.

"Lowanna's clip preparation was excellent and it is appreciated when wool classers take time to follow through to point of sale," Mr Pedersen said.

Mr Johnston said his April-shorn clip was off a reasonable season.

"We run a 70/30 crop/sheep program and worked towards heavy cutting Merino sheep," he said. "My father began using Wallinar bloodlines back in 1954 and we have been breeding all our own flock rams in recent times."

He said his brother, Bill Johnston, of Fibre Management, did all the sheep classing for the farm.

"We are using the best technology possible to increase wool cut and quality," Mr Johnston said.

Mr Pedersen said the Johnstons also had experienced success through hedging a portion of their wool clip.

"The wool which was hedged back in April 2011 sold at higher than current market values," he said.

As for the current wool prices, Mr Pedersen said finer micron prices were lower than last year because of limited demand.

The National Council of Wool Selling Brokers of Australia executive director Chris Wilcox said exports of 19 micron and finer were down in both Italy and China.

"For this season to March, exports to Italy are down 11 per cent and Australian exports of 19 micron and finer to China are down 25 per cent in volume and 10 per cent in value," he said.

Mr Wilcox said on the supply side, 18.5 micron or finer had increased by 7 per cent.

"The combination of higher supplies and lower demand for fine and superfine wool is the reason why the price premium for this wool has collapsed to such low levels," he said.

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