Buyers hopeful of smaller passed-in rates

Buyers hopeful of smaller passed-in rates

News
Aa

With more fresh wool appearing in Western Wool Centre (WWC) auction catalogues and a reduced national offering this week, brokers are hopeful prices will remain firm and pass-in rates return to normal.

Aa

WITH more fresh wool appearing in Western Wool Centre (WWC) auction catalogues and a reduced national offering this week, brokers are hopeful prices will remain firm and pass-in rates return to normal.

Pass-in rates of up to 33.6 per cent and regularly close to 20pc have been an unwelcome feature of WWC auctions since the end of October and carried over into the first two trading weeks of this year.

Sellers resisting downward price pressure by refusing to drop reserve prices and a general lack of buyer interest in bidding up meant a sizeable portion of each week's auction offering had been offered previously but had not sold the first time.

Despite relatively high pass-in rates for the first two weeks of WWC auctions this year, the very large offerings appear to have cleared some of the backlog of reoffered wool.

Some better quality wools from late spring and summer shearings is now starting to filter through the auction system.

Two of the buyers critical of the quality of reoffered wool which kept reappearing in catalogues before Christmas, Greg Horne who buys for Modiano Australia and Alan Brown who buys for new trader Meliwa, last week noted the change.

"There's some good wool in there," Mr Horne said of last Thursday's catalogues.

"We've been looking at rubbish so it makes a change to see some good wools that we can have confidence in bidding on," Mr Brown said last Thursday.

With the holiday period over and the Chinese new year festivities either out of the way or cancelled because of concerns about coronavirus, brokers and buyers are hoping for more stable trading at the WWC this week.

Thanks to a strong recovery last Thursday, prices regained much of what they had lost the previous day and are now realigned at the WWC, Melbourne and Sydney Australian Wool Exchange (AWEX) selling centres after the unusual start to the year - the Melbourne centre traded an extra day in each of the first two weeks, but returns to selling two days this week.

The Western Indicator finished down just two cents for last week at 1685 cents per kilogram clean.

Losses for the mid-micron price guides were small - less than 6c/kg - at the WWC, except for the 20 and 21 micron guides which lost 15c and 20c respectively.

The 17.5 and 19 micron guides each added a cent for the week.

Biggest influence on price this week may be supply, with the national offering dropping to 40,680 bales after offerings of 52,666 and 52,261 for the first two weeks, according to AWEX.

The WWC offering is projected to be 9442 bales, down from 11,714 last week and 13,782 the previous week.

Aa

From the front page

Sponsored by