Wool price drop

27 Jan, 2013 01:00 AM
Albany producers Jarrad Norton (left), Kurt Haskins and Chris Norton with Landmark agent Noel Hulm and Eric Norton, Albany.
Albany producers Jarrad Norton (left), Kurt Haskins and Chris Norton with Landmark agent Noel Hulm and Eric Norton, Albany.

COMING off a stellar sale last week, the market experienced minor disappointment with slight price falls across all centres.

The greatest losses of the week occurred in the WA market where 20 cents was wiped from the opening figure of 1146c/kg.

The WMI lost 14c/kg on Wednesday with further losses of 6c/kg on Thursday to close at 1126c/kg.

The Eastern Market Indicator opened the week at 1111c/kg which weakened 6c over three days to finish at 1105c/kg.

Both the Northern and Southern centres saw falls of 7c and 5c respectively.

This week was a large offering with 58,189 bales on offer and 53,355 bales cleared to the trade.

Elders WA Wool co-ordinator Danny Burkett said that it was important to look beyond the short term in response to falls in the market this week.

"In the last seven trading weeks the markets rose $1.40 to $1.60 clean, we have lost 30c of that last week but it is important to keep that in perspective given where we've come from," he said.

Landmark business development manager (wool) Ben Silverman, said he expected the market to remain firm to dearer through the rest of January and into the February period.

"Combined with the first fortnight, the first three weeks of 2013 will have had a combined offering of 163,000 bales and the biggest start to January in five years," he said.

"If there is no improvement in demand after that it may struggle to maintain these levels.

"Nationally this week we are expecting an offering of just over 50,000 bales."

Primaries wool manager Tim Chapman attributed the price drops to a large offering and large purchases of the previous sale.

"The less effected would have been at the finer end of the market with 17.5 microns and finer remaining firm," he said.

Albany producer Chris Norton offered 92 bales and expected to collect 1000 cents per kilogram greasy in last week's sale but ended up receiving a top price of 1170c/kg with an average of 900c/kg.

Mr Norton said the sale produced a good result, in the context of current markets, but he found prices disappointing compared with the last two years.

The Redmond farmer runs 4500 head of sheep on his 2500ha property, north east of Albany.

"I guess to some extent we are happy, but in reality we aren't really happy at all," Mr Norton said.

Like many in the industry, he said the live export issues in the 2011/2012 period had hurt their operations.

"We really hope that the market improves," he said. "We are positive but we hope that the government will be more supportive of producers of food and fibre in 2013."



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