IT may be coincidence, but a leaders' handshake on a world stage seems to have given the wool market some confidence.
Australian Prime Minister Anthony Albanese's shaking hands with Chinese President Xi Jinping at the G20 Summit in Indonesia, this month, with a hint of a thawing in relations between the two countries to come, preceded good price rises across the board at the Western Wool Centre (WWC) and other wool selling centres last week.
- Subscribers have access to download our free app today from the App Store or Google Play
Australia's wool industry is dependent on good relations being maintained with China which, according to Australian Wool Exchange (AWEX) data, takes 82 per cent of the wool produced here.
Our next biggest wool customers, India, Italy and the Czech Republic - taking 7pc, 4pc and 2pc respectively - are hardly likely to take up the slack should China for some reason decide it does not want our wool, just like it did some of our other commodities.
Coincidence or not, after the handshake, the Western Market Indicator (WMI) added 29c last week to finish at 1408 cents per kilogram clean - the first time the WMI had been back above 1400c/kg since the first sale of last month.
The benchmark Eastern Market Indicator added 24c to finish at 1256c/kg, according to AWEX.
After being largely unwanted at the WWC for several weeks, the finer micron wools bounced back with indicative price rises of 62c, 76c and 51c for the 18, 18.5 and 19 micron fleece segments for the week.
The 19.5-21 micron fleece segments also enjoyed price rises, just not quite to the same level.
Merino cardings added 7c for the week to finish at 906c/kg.
Buyers were most confident on the first trading day and followed the positive lead of the Eastern States' centres.
The confidence carried through to the second day with a smaller offering seeing some spirited bidding.
Overall the WWC passed-in rate dropped back to 10.8pc last week, in sharp contrast to the preceding four weeks when more than a quarter of the offering was passed in one week.
READ MORE SHEEP/WOOL NEWS:
PJ Morris Wools, Techwool Trading and Endeavour Wool Exports continued to jostle for position at the top of the WWC buyers' list.
AWEX has pointed out the positive market last week has attracted more sellers for this week, with the national wool offering set to grow by just over 5000 bales to 38,295.
The WWC offering is listed at 6743 bales this week, an increase over last week of 1243 bales.
