The Australian wool market edged slightly higher this week, with the EMI gaining 4 cents to close at 1,880 ac/kg following the 47th sale of the season. In the west, the WMI eased modestly by 3 cents to finish at 2,086 ac/kg. While the AUD softened slightly during the week, historically it remains at relatively elevated levels, continuing to present headwinds for the wool trade in USD denominated returns, with the EMI falling by 21 US cents and the WMI by 29 US cents.

Across the catalogue, fine Merino types (16.5–19.0µm) were generally 5–10 cents dearer, while medium Merinos (19.5–24.0µm) were unchanged to slightly easier. Crossbreds (25–32µm) again continued their strong run, lifting 25–30 cents, while cardings added 15–20 cents.

The headline again this week was the continued strength in the crossbred and cardings sectors, which remained the best performing areas of the market. Across the southern and northern selling centres, crossbred Micron Price Guide percentile rankings are now sitting at or above the 99th percentile over the past five years, highlighting the elevated pricing levels currently being achieved in these categories. Strong competition for broader microns and carding types continues to reflect solid demand for lower-cost raw wool.

The market remains broadly well supported, however buying activity continues to operate within an increasingly selective environment. Industry sentiment suggests the trade has moved from a critically underbought position earlier in the year to a more partially covered state. Combined with the recent market strength, buyers are now placing greater emphasis on specification rather than overall volume. Price spreads between higher and lower specification wool are becoming increasingly evident as buyers place stronger premiums on well-presented and better specified lots, as they look to manage tightening trading margins.

Next week has 27,334 bales on offer, with Fremantle selling Tuesday and Melbourne and Sydney selling Tuesday-Wednesday.