Prices at this week’s Australian wool auctions continued to improve. All types and descriptions moved higher, ranging in magnitude from 5 to 20ac/clean kg. A cautiously optimistic atmosphere in sale rooms remains the dominant sentiment, with positive market outlooks starting to overwhelm the negative. 

Supply is at the top of all participants minds and the shortfalls are starting to see a more willingness from buyers to pay more to secure supply. This week’s selling evidenced this as 48.4% of the Merino fleece sold went to the four direct top making and vertically integrated factories buying representatives from China. 

With Fremantle sitting out the week all the supply pressure was in the Eastern states. The purchasing strength of the largest Chinese top maker was exhibited in Sydney on the final day of selling. An extraordinary buying day saw them buy over 36% of all Merino fleece sold for the day in that centre.

As most of the Merino fleece buying and price advancements were done and caused by first stage mill interests, trader opportunities to transact new contracts on Merino fleece types were limited in volume and sharp in the forward price levels obtainable.  

Traders were keenly involved in the competition, but more of their purchasing came from the skirting and crossbred wool types. Anecdotal exporter reports had these wool sectors as being “easier to sell” and enquiry for further quantity was running more consistently. 

Merino fleece types traded strongly throughout the selling week, and a general gain of around 15ac/clean kg was recorded on all types. Some choice clips were again strongly sought by the Italian weavers, particularly the sale lots between 17 and 19micron which saw prices hit premium levels around the 150/200ac mark above that of the general selection.

Merino skirtings, crossbred fleece and pieces and carding types all sold exceptionally firm to 5ac dearer. Limited volumes across this selection helped the stability and the push upward.

Auction volumes rise substantially next week for the final sale prior to the three-week winter recess in sales. A touch over 38,600 bales are being offered with Fremantle re-joining the schedule. Auctions will be conducted on Tuesday and Wednesday, with Fremantle selling just on Tuesday.