The Australian wool market finished 0.4 percent higher, on average, at sales in Sydney, Melbourne and Fremantle this week. The AWEX EMI rose by 5 Australian cents (0.6 percent), ending the week at 855 Aust cents a kg.
This reflected rises of 5 Aust cents (0.6 percent) in the North and 4 Aust cents (0.5 percent) in the South, with their corresponding Regional Indicators finishing the week at 892 Aust cents and 823 Aust cents clean, respectively.
The Western Indicator rose by 2 Aust cents (0.2 percent), finishing the week at 834 Aust cents. In a two day sale in Sydney and Melbourne, the AWEX EMI rose by 7 Aust cents on Wednesday and fell by 2 Aust cents on Thursday. The Western Indicator rose by 7 Aust cents on Wednesday and fell by 5 Aust cents on Thursday in a two day sale in Fremantle.
A total of 38,007 bales were on offer, compared with 37,985 bales last week, of which 10.2 percent were passed in, comprised of 8.0 percent in Sydney, 9.4 percent in Melbourne and 14.1 percent in Fremantle. Pass-in rates for Merino fleece and skirtings were 10.2 percent and 11.6 percent, respectively. 2,041 bales (5.1 percent) were withdrawn prior to sale and re-offered bales made up 13.1 percent of this week's offering.
The US exchange rate has fallen by 12.89 Aust cents (15.5 percent) since Sale 01, when was 96.24 Aust cents. This week's fall in the exchange rates was influenced by the Reserve Bank's decision to lower the official interest rate from 7.25 to 7.0 percent on Tuesday (the first decrease since December 2001) and the announcement on Wednesday of lower than expected economic growth in the June quarter. The recovery in exchange rates on Thursday suggests that they had over-reacted on Wednesday.
The market rose strongly in Australian currency on Wednesday in response to the 3.8 percent depreciation in the US exchange rate, with rises across all micron ranges and wool types, particularly for 19 and 21 to 23 micron wools. Some of these gains were lost on Thursday when the exchange rate firmed.
However, the easing was less than change in the exchange rate and the EMI lifted by 6 Aust cents in US currency Average AWEX Micron Price Guides (MPGs) were up by 9 Aust cents for 17.0 microns and 17.5 microns, by 4 Aust cents for 18.0 microns, by 7 Aust cents for 18.5 microns, by 6 Aust cents for 19.0 microns and by 7 Aust cents for 19.5 microns.
The 20.0 micron wool average MPG was up by 6 Aust cents clean, 21.0 microns by 13 Aust cents, 22.0 microns was unchanged, 23.0 microns was up by 3 Aust cents, and 24.0 microns by 3 Aust cents. Skirting types also generally firmed over the week, while oddments were in strong demand on both days leading to a 10 Aust cents (2.5 percent) increase in the Merino Cardings average MPG.
Crossbred average MPGs rose by 7 Aust cents at the fine end, by 12 to 13 Aust cents in the medium range and by 5 Aust cents at the coarse end. Buyers for China were particularly dominant with support from buyers for Europe and India. There were some suggestions of better demand from Europe as the industry returns from summer vacation. Sales will be held in Sydney, Melbourne and Fremantle next week, when 46,380 bales are currently rostered for sale.
Present estimates for the following two sales vary are 53,710 and 47,700 bales respectively, a decrease of 4.7 percent over the three sale period when compared with last year. In South African sales, the Cape Wools Indicator was down by 3.5 percent since last sale two weeks ago against a 1.4 percent depreciation of the Rand against the US Dollar and a 0.8 percent appreciation against the Euro.
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