Reduced quantity eases market pressure

Smaller offering eases market pressure

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Smaller offering eases market pressure and stimulates buyer demand.

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Off the back of the biggest weekly percentage drop since 1991, the Australian wool market steadied slightly this week due to a smaller offering helping to ease market pressure and stimulating buyer demand.

The national offering reduced to 30,272 bales which was 12,492 bales less than the previous week.

The AWEX Eastern Market Indicator (EMI) dropped by a marginal two cents, landing on 1004 cents per kilogram, clean, but in a positive shift, over 80 per cent of the wool on offer boosted in value with all Merino and crossbred fleece types recording increases.

Senior market analyst, AWEX, Lionel Plunkett said the smaller fleece offering attracted strong widespread competition with the stronger buyer sentiment pushing the prices higher.

"Most sellers were keen to accept the higher prices on offer with the national pass-in rate dropping to 8.2 per cent," Mr Plunkett said.

"This was 21.8pc lower than the 30.1pc passed in rate of the previous week."

Across the country the individual fleece micron price guides (MPGs) rose by two to 29 cents and the crossbred wools also increased by four to 23 cents.

However, it was the significant losses in the skirting market that meant the market recorded the small overall loss.

All types and descriptions generally fell by 20 to 30 cents, but the dramatic loss in locks, stains and crutchings which fell by 70 to 90 cents, was the factor pushing the EMI to a lower level.

Mr Plunkett said compared to the corresponding sale of the previous season, the EMI is 509 cents lower, a drop of 33.6pc.

"The EMI is now at its lowest point since August 2014," he said.

"Due to currency movement, when viewed in US dollar terms, the fall in the EMI was slightly higher, the EMI lost 8 USc."

Next week there is an increase in the offering to 35,252. Fremantle will only conduct a one-day sale due to quantity, selling on Wednesday.

The story Reduced quantity eases market pressure first appeared on Farm Online.

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