WA wool makes up ground at auctions

WA wool makes up ground at auctions

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After a week without live wool auctions, Western Australias wool market played catch-up, with solid price gains last week.

After a week without live wool auctions, Western Australias wool market played catch-up, with solid price gains last week.

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At the Western Wool Centre (WWC) 19 micron fleece continued to be the star and was most in demand last week, which was good news for the average WA woolgrower.

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AFTER a week without live wool auctions, Western Australia's wool market played catch-up, with solid price gains last week, as Eastern States' wool markets drifted backwards to meet it.

At the Western Wool Centre (WWC) 19 micron fleece continued to be the star and was most in demand last week, which was good news for the average WA woolgrower.

The average WA Merino fleece wool last season measured 19.2 microns, finer than the average in any other State and compared to a national average of 20.8 microns.

On the first trading day back last week from the one-week WWC-only recess in the Australian Wool Selling Program, 19 micron Merino fleece held its ground, while the other micron price guides - apart from the 21 micron guide - and Merino cardings lost ground.

On the second trading day the 19 micron guide added 20 cents, the biggest rise of the week at the WWC, to finish at 1629c per kilogram clean.

The 21 micron guide added another 2c on the second day to finish up 13c for the week at 1233 cents a kilogram and a 19c rise on the second day pulled the 18.5 micron guide back up to 1787c/kg, for a rise of 9c for the week.

But the 19.5 and 20 micron guides and Merino cardings guide lost 7c, 10c and 20c respectively for the week.

The Western Market Indicator put on 5c for the week to finish at 1356c/kg, compared to the benchmark Eastern Market Indicator which shed 18c to 1332c/kg, with losses across the board ranging between 6c-50c in Melbourne and 12c-31c in Sydney for volume wools.

The previous week during the sales recess Australia Wool Network (AWN) State wool manager Greg Tilbrook, at the Dowerin GWN7 Machinery Field Days, had suggested that 19 micron wools were the ones to watch and that Farm Weekly might want to look at a price comparison of 19 micron wools this year and last year.

"Buyers are chasing the better spec stuff - they don't want to be carrying faulty types - but 19 micron (fleece) is 500c/kg to 600c/kg up on this time last year," Mr Tilbrook had pointed out and he proved to be close to the mark after last week's trading.

Australian Wool Exchange (AWEX) statistics show that 12 months ago 19 micron fleece sold for just 964c/kg at the WWC, 665c/kg less than what it was selling for at the end of last week.

It's current price is a 68.9 per cent increase over the same time last year, but more importantly, according to AWEX, the 19 micron price guide's price position over the past 12 months is 76.5pc - that is, for more than three quarters of the past 12 month the price of 19 micron fleece has been below what it is now.

Only the 18.5 micron price guide has a bigger rise compared to 12 months ago - 69.5pc, from 1054c/kg to 1787c/kg last week, but it's price has been below what it is now 46.2pc of the time so its current strength is not as pronounced as that of 19 micron wools.

The price comparisons for other micron price guides and Merino cardings are not as dramatic, with current prices ranging from 35pc-47pc above those of 12 months ago.

To put that into perspective, this time last year the WWC wool market was bottoming out due to the impact of COVID-19 on wool processors and lockdowns hitting face-to-face retail outlets of wool products globally.

But on this week 12 months ago the WWC wool market stopped sliding and a week later began a strong and sustained recovery.

AWEX statistics show that last week's 19 micron price was not just strong compared to a bottom price last year.

Last week's finishing price for 19 micron fleece was also 7.8pc stronger that what it was 24 months ago, before COVID-19 had hit anywhere in the world.

The statistics also show that last week's 18.5 micron price was 15pc up on what it was two years ago, the 19.5 micron price was up 1.1pc and Merino cardings price was up 4.7pc.

But 20 and 21 micron wools are currently selling for 8pc and 14.2pc less than they were two years ago pre-COVID.

Despite the strong WWC market last week, more than 30pc of the week's offering was passed in as woolgrowers and brokers declined to adjust reserve prices.

That was after 12.2pc of the listed offering was withdrawn by brokers before auctions began, after they heard of sliding prices in Melbourne and Sydney selling centres which begin trading two hours ahead of the WWC.

In his market report on the first day's WWC trading last week, AWEX technical officer Andrew Rickwood noted "news of the lower prices on offer in the east prompted over 14pc of the fleece offering to be withdrawn prior to sale" by Nutrien Ag Solutions, Dyson Jones Wool Marketing Services and AWN.

This week, the WWC has 5400 bales listed for auction, 2361 fewer than was offered last week, but the national offering is set to rise by 2004 bales to 37,123.

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