FINE Merino wools epic run in the Australian wool market has come to abrupt halt, as sheepmeat prices continue to rally in record territory.
Despite a small national offering of less than 30,000 bales, the Eastern Market Indicator (EMI) experienced its fourth consecutive week of falls, softening 23 cents to 1472 cents a kilogram last week.
National Council of Wool Selling Brokers of Australia chief executive Chris Wilcox said the declines came despite a sharp drop in the Australian dollar.
Prices for superfine wool, 18.5 microns and fine, fell between 60 and 90 cents, while medium Merino wool, 21-22 micron, and crossbred wool prices remained steady.
The Northern Market Indicator experienced the most dramatic fall, down by 33c to 1547 c/kg, Mr Wilcox said.
The Southern Market Indicator fell by 19 cents to 1426 c/kg, while the Western Market Indicator slid 16 cents to 1504 c/kg.
Mr Wilcox said while the Australian dollar fell by over a US cent this week against the US$, the EMI was down by 34 UScents to 1088 USc/kg.
“In the past four weeks, superfine wool prices have dropped by from 7-8pc, while prices for medium Merino wool have eased by 1-2pc,” Mr Wilcox said.
“These different trends have dampened the price premium for fine and superfine wool relative to other microns.”
Despite the market slide, Mr Wilcox said the current premium of 40pc was more than double the average seen since 2010.
AWTA reported a remarkable 23pc increase in May in the weight of wool tested compared with May 2016.
“It should be noted that the weight of wool tested in May 2016 was the lowest May total for many years, so the increase this year is somewhat inflated,” he said.
“Even so, the weight tested this May is the largest since 2012.”
The changes were in the opposite direction for sheepmeat, with the surge in prices continuing.
The National Trade Lamb Indicator rose a further 2c/kg to 671c/kg on Tuesday, while mutton remained content at 526c/kg.
Despite the Queen’s Birthday inspired public holiday flushing extra numbers on the market, demand for sheepmeat remains unquenchable.
Landmark livestock manager Peter Cabot, Wagga Wagga, NSW, said the market was currently riding the seasonal peak.
“It has been extraordinarily good for the past six weeks and I can’t see things slowing,” Mr Cabot said.
“With such limited supply, most lambs are going to the major saleyards and very few are going over the hooks.
“That is pushing the big buyers into the yards, as they’re having to source numbers for the next day kill - I can’t see that changing.
“Normally it peaks about now, June is considered the dearest month so you’d imagine we’re in the thick of it.”