The depreciating price trend continued this week at Australian wool auction sales although the rate of falls slowed considerably. Merino wools of all types and descriptions were allowed to drift backwards from the outset by buyers, but the under-current of swelling demand became evident towards the close of selling and arrested the slide on quite a few of the type sectors. The AWEX EMI (Australian Wool Exchange- Eastern Market Indicator) fell by 27ac for the week and settled at a week ending figure of 1751ac/clean kg.
The foreign exchange (forex) rates on all of the major currencies didn’t really stimulate overseas buyers to move trade sentiment to the positive either. Those rates all appreciated against the Australian dollar (AUD) by varying degrees of between 0.4 and 0.8% . As such, the EMI when expressed in US dollars was far less affected and drift-ed 13usc lower or 0.9% lower to 1379usc/clean kg. After a few weeks of going against the trend of most other currencies moving up against the AUD, the Euro finally succumbed and joined that trend and recorded the strongest movement. For buyers using this currency, this dulled the AUD falls and eliminated most of the advantages of the weaker auction prices. This remains probably theoretical only though, as buyers reported a high percentage of the wool on offer was not suitable to this market due quality.
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