Weekly Market Wrap

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With Adrian Field, Melbourne
Trading Manager

August 10th, 2007

Market turnaround

IT just goes to show what a huge shortage in wool will do to a market. Last week was obviously an over-reaction to the Chinese quota situation, with most of the harm done earlier in the week.

The eastern market indicator recovered 25 cents per kilogram this week to close at 899c/kg.

With so much wool being withdrawn from the sale, it ended up being the smallest offering in four years - only 35,166 bales were offered. The increase in prices had a big impact on passed-in rates, with only 7.9 per cent passed in.

Sales were again held in Fremantle, Sydney and Melbourne, with all Merino fleece types improving.

Southern region

All Merino fleece microns improved 20-40c/kg, with 18 and 19 micron types receiving the best support.

Merino skirtings were 40-70c/kg better and were nearly back at old levels.

Crossbred fleece also had a big turnaround, especially in the 28-micron range, which jumped by 35c/kg.

Cardings improved also, with most types about 10c/kg higher.

Sales will again be held in all three centres next week, with a little under 40,000 bales rostered.

Prices are expected to remain stable due to another small offering. Chinese buyers are resisting current prices, but there likely is enough demand worldwide for woollen garments to keep market levels up.

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