Despite the major correction on Wednesday, just 26,000 bales were actually sold to the trade this week. The high passed in rate, nationally 23.6%, seemed to help the market yesterday as buyers increased their urgency as the sale progressed. They were struggling to secure sufficient volume. The general tone in the sale room on Thursday was considerably better and we felt the market in Melbourne (the largest offering) was only marginally changed compared to Wednesday. Fremantle, the last sale to finish, recorded gains yesterday of between 0.5 to 1%. This was a clear reversal of Wednesday’s trend and should be considered a very positive result.
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40,000 bales are rostered for sale next week. We will see if grower expectations are adjusted with this week’s correction or if they maintain expectation that exceed the current levels. This will go a long way towards determining the direction of the market next Wednesday. The selection is dropping off as the offering of the better fine wool now starts to slow. The micron profile has been a little finer this year due to the drought but the tensile strength has been excellent and vegetable matter low. This will provide some benefit to our spinner and weaver clients who’ve been buying through this period. These types are now in smaller supply. Right now, the premiums are not great for the best quality but traditionally the price gap between the better types and the average types does increase as we move into November and December. Proportionally, the percentage of inferior, high mid break, wool on offer will increase.
Some may well see this as a buying opportunity. There should be no doubt that the fundamentals of supply and demand that resulted in the the resent record levels hasn’t changed much. The market is correcting to a more appropriate level of price to match customer expectations. Typically the market will over correct before a bounce. Time will tell.
Auction offering – current week
Selling Centres for week 17
Market Sale Offered Sold Passed In
North S 17 8338 6463 22.5%
South M 17 18716 14773 21.1%
West F 17 6317 4590 27.3%
Auction offering – next week
Market Sale Sale days Volume
North S 18 W-T 9731
South M 18 W-T 22145
West F 18 W-T 8475
If you want to see the complete Wool Sales Roster click here.