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Wool prices reversed trend at Australian wool auction sales this week as prompt demand rose with lighter volumes on offer. A falling Australian dollar impacted by China trade uncertainty was also supportive.

Wool Auction March 23

The Australian Wool Exchange-Eastern Market Indicator (AWEX EMI) regained all of the losses of last week. With most wool types and descriptions gaining prices in lockstep with changing currency prices. The stand outs were the 19 to 21 micron merino fleece which saw prices rise higher than the percentage currency gain on new demand.

Following the auction AWEX EMI rose by 27ac for the week and closed at 1778ac/clean kg. The week begun with the Australian dollar down against all of the major currencies over 2 per cent from the last auction. The local wool market priced in the immediate impact which saw gains for overseas buyers that had previously locked in at the lower delivered price in USD and other currencies.

Australian Wool Innovation ‘Wool Market’ report for sale week 38 of the current season ending March 23, 2018.

Merino wool movements during the week were all positive with buyers chasing on wools with better tests or containing light vegetable matter (VM) readings. “This demand was witnessed across all micron brackets and gains on these wools was initially 60 to 80ac but a pullback was recorded on the final day as sale rosters were released showing a massive increase of over 21 per cent or 8,000 bales for next week. A strengthening dollar also slowed interest, but it was primarily the pressure relief of more wool than expected available for prompt buying that hampered the rising market,” the report said.

The crossbred sector had a solid week also with rice gains of 20ac/clean kg  recorded.  Cardings enjoyed similar gains of 20 to 30ac/clean kg.

For next week, 47,000 bales are rostered for auction. The large volume is expected to test current demand levels, according to AWI. (RKS)

Source: Wool.com

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