China contract inquiries up
The Australian wool market’s benchmark indicator rose 77 cents/kilogram closing last week at 1858¢/kg clean.
AWEX said the value of wool sold to date was $58.2 million or $2007/ bale taking the total to $1.332 billion.
The Western Market Indicator was 81¢/kg stronger as the $A fell 0.29¢ against the $US to close at 72.50¢ on Thursday.
Australian Wool Innovation trade consultant Scott Carmody said there was an increase in Chinese inquiries for new contracts.
“What percentage of this interest and how it converts to actual new business remains to be seen in order for a continuation in market pricing,” he said.
The Elders International Wool Report stated medium Merino fleece performed best during the week with increases of 100¢/kg, while superfine categories added only half that amount.
“Skirtings, particularly the better, lower vegetable matter content lots were strong, and crossbred wools gained 50 to 80c/kg as some large orders came out of China,” the report said. “Processing mills are looking to cover the auction recess period in the next three weeks and those buying crossbred types do so at a lower cash-onhand risk.”
The report said the carding sector recovered, after falling more than 500¢/kg in the past three months, but have regained 150¢/kg in the past two weeks.
“The carding sector, which was selling at 85 per cent of fleece value, is now back to a more realistic 55 per cent level,” the report said.
“Overall, the wool market has survived the traditional off-season where demand was absent and buyers had price resistance.”
The report said some brands had decided how to bridge the gap and had begun to place orders for the 2019-20 season, although many Chinese processors were struggling at present.
“Domestic orders within China are said to be quite slow,” the report said.
Wool offerings for the coming three sales are expected to range from 36,374 bales to 40,883 bales and to be 23.5 per cent less than the same period last year.
Tim Burgess with greasy wool.