Buyers enter the Christmas spirit
The Christmas spirit continued this week in wool sales with buyers bidding strongly from the Tuesday opening, before becoming slightly more subdued on Thursday. This resulted in strong week-on-week increases across the board, with the 32 MPG in Melbourne the only one to miss out.
This pushed the EMI to a new high of 1760 cents, adding 405 cents for the year – an outstanding 29.9% improvement.
Despite a slightly stronger Au$, the market improved 67 US cents for the week underpinning the strong market sentiment. W.A. didn’t miss out either with the WMI lifting 54 cents, closing the year at 1816 cents.
The total value of wool sold in the calendar year surpassed the $3.0 billion mark, this being the first time since 1995 when AWEX records started.
The increases year-on-year are impressive and worth noting, the EMI lifted 30% in Au$, while in US$ it was up 34%. To select a couple of other star performers, the 16.5 MPG rose 48%, 18 MPG plus 35% and the median wool clip 19 MPG was up 29% on the year ago levels.
Cardings have continued to “outperform”, posting a 32% gain for the year to end at almost 1500 cents.
The outlook for 2018 is positive, as brokers report that some wool growers have already shorn and sold wool that would have usually only came to the market in the January to March period. It seems a combination of more frequent shearing patterns and the attraction of higher prices has pulled wool deliveries forward. While the full extent of this is unclear, any reduction will have a tightening effect on supply in the New Year which will keep buyers keen.
The week ahead
The market now takes a 3-week break with sales resuming in the week beginning the 8th of January.
There will be wool growers who have delivered wool to store for sale in the New Year eagerly looking forward to the opening sales.
It is a time for optimism with returns from Merino sheep at levels rarely seen, giving the industry a timely boost that hopefully sees an increase in wool production.