Australian wool auctions on the surface appeared to be rather mundane this week, but some vastly differing results were recorded across the wool type spectrum. Demand picked up on super fine Merino and cardings, causing positive price movement, whilst the broader than 19 micron Merino and crossbred sectors all suffered a slowing in interest and negative price impacts in reaction to the strengthening AUD (Australian Dollar) versus the three major wool trading currencies of the USD (US dollar)/CNY (Chinese yuan) /Euro exchange rates. The AWEX EMI (eastern market indicator) did manage to pick up 2ac though and closed the week out at 1568ac/clean kg.
Underlying strength of demand remains in play evidenced by the EMI expressed in foreign buying currencies outperforming the AUD local market. The USD EMI appreciated by 0.6% during the course of this week’s selling to close at 1231usc/clean kg but the CNY continued its relative and historical switch away from the normally rate pegged behaviour with the USD against the AUD and advanced doubly by over 1.2%. Similar advances of 1.2% were also made in Euro terms. Year on year comparisons show the EMI price levels are currently 20.5% higher in USD terms, and 17.8% increase in AUD, emphasising the robust appeal that wool currently holds.
Click here to access AWI's Wool Weekly Market Report (PDF 865 KB)