Crossbred wools now easing EMI price slide

Solid lift in demand for crossbred wool eases EMI price slide


Sheep
NOT ALL NEGATIVE: The lift prices for broader crossbred wool helped minimise the fall in the benchmark Eastern Market Indicator.

NOT ALL NEGATIVE: The lift prices for broader crossbred wool helped minimise the fall in the benchmark Eastern Market Indicator.

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The most positive note out of this week's wool market was the lift in demand for crossbred wools.

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The benchmark Eastern Market Indicator (EMI) has now fallen 416 cents a kg clean since the start of 2019 as the slide in wool prices continued this week.

The biggest positive out of this week's market was the lift in prices for crossbred wools.

The EMI lost another 11c at sales in Sydney and Melbourne but the fall, mercifully, was minimal compared with last week's 163c freefall.

AWEX said buyers were now looking for value in the market with their major focus on the better style lots with good additional measurements.

Non-mulesed wool continued to attract strong competition during this week's sale, maintaining their healthy premiums over similarly specified wool (as much as 200c clean for selected lots).

Lesser style wools and those with poor additional measurements lacked the same demand resulting in general losses of 50-80c, AWEX said.

It was the reduction in these types that pushed the individual micron price guides generally down by 20-50c.

The EMI closed the week at 1494c with nobody sure where it will settle in coming weeks.

It has now dropped 622c since the peak of August 2018, a reduction of almost 30 per cent.

President of the National Council of Wool Selling Brokers of Australia, John Colley, said the market had risen too fast and a correction was always inevitable.

But he said buyers couldn't stay out of the market forever.

AWEX said despite the further price reductions, more sellers were willing to accept the current price levels with a national pass-in rate of 16.1pc.

Crossbreds were the only sector to record increases for the series with 26 to 28 microns generally rising by 25-40c. These gains stopped the EMI from a larger fall.

Turnover for the week was $36.99 million, bringing total turnover since the start of the new selling season to $241m.

The wool market has been thrown into disarray by economic uncertainty and plummeting consumer confidence triggered by the China-US trade war and other major geo-political problems.

China bought 75pc of last year's Australian clip. Its purchases of 225.8 million kg dwarfed its closest rival, India, which bought 17.3m kg or six pc of the clip.

A total 33,046 bales are rostered for sale next week in Sydney, Melbourne and Fremantle but the actual offering is likely to be much less because of clip withdrawals.

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