The Australian wool market has continued to adjust downward in Week 47, following on from the losses experienced during the previous week’s sales. Buyer confidence was very low, as exporters tried to see at what point the market would settle. Prices opened lower and then continued to fall as the sale progressed. By the end of the first selling day prices had generally been discounted by 40 to 60 cents.
The AWEX Eastern Market Indicator (EMI) lost 52 cents for the day. Due to a lack of quantity the Western region was reduced to a one-day sale. Selling last on Wednesday, the large reductions in price resulted in a passed in rate of 48.7%, this combined with the 10% of wool withdrawn prior to sale, meant that only 41% of the original offering was sold to the trade. This was the lowest clearance rate in the West since 2003.
There were positive signs on the second selling day in the Eastern centres, where only minimal price movements were felt. This was reflected in the Eastern Market Indicator (EMI) which fell by only 8 cents. The EMI lost 60 cents for the series, closing the week at 1,833 cents. The EMI has now fallen by 119 cents over the last two weeks, this is a drop of 6%. The crossbred sector sustained further price reductions, after the substantial losses recorded last week. Weak buyer demand resulted in 26.0 through to 32.0 micron generally falling by 50 to 110 cents.
After hitting a record level three weeks ago, the Micron Price Guide (MPG) for 28.0 micron has fallen by 219 cents over the past two sales, a reduction of over 14%.
Next week quantities dictate that Fremantle will again hold a one-day sale, currently there is 31,462 bales rostered for sale in Sydney, Melbourne and Fremantle.