The Australian wool market has had another tumultuous series suffering further large losses after those experienced in the previous week. The suspension of wool auctions in South Africa reduced the overall global supply but this did little to bolster demand here in Australia.
Major auction players were again absent and those buyers that were active continually reduced their buying basis as they accumulated wool.
The market opened with the prices generally 100 cents below those achieved at the previous sale. The lack of buyer confidence meant that prices deteriorated as the series progressed. By the end of the first day prices had generally fallen by 110 to 140 cents, the AWEX Eastern Market Indicator (EMI) fell by 112 cents on the back of the losses, a reduction of 6.7%. In percentage terms this was the largest fall since 2008. The weakness continued on day two with the market unable to find a solid level, as buyers continued to lower their basis as the sale progressed.
The EMI lost a further 51 cents, losing a total of 163 cents for the series, closing the week at 1513 cents. The EMI fell by 9.7% for the series, again the largest weekly fall since 2003. The last time the EMI was at this level was June 2017.
The highlight of the week, in an otherwise gloomy market was the good support for Non-Mulesed types. A small number of buyers competed strongly for these types, pushing them as much as 200 cents (clean) higher than similar types. The market downturn was met with very firm seller resistance, 16.7% of wool was withdrawn prior to sale, followed by a passed in rate of 35.8%, the highest figure since 2003.
The Western region has a one-week recess next week, with only Sydney and Melbourne in operation the national offering reduces to 33,696 bales.