CURRENCY dipped nicely again just before wool auctions began this week, allowing for a stable market in US dollar terms.
The Eastern Market Indicator (EMI) closed at 1779 cents per kilogram, after an overall increase of 27c/kg, which was coincidentally the same amount that was lost the previous week.
Superfine Merino types were on the back foot, with very few lots offered, and even fewer lots demanded, but remained in positive territory in Australian dollar prices.
Medium Merino types all recorded small gains in US dollars, and improved by 30-50c/kg in grower accounts.
The overall tone of discounts for processing faults prevailed and looks certain to continue for the future now that these discounts have become well established in the barames of buyers and processors.
This is a healthy and logical trend and will provide growers with clear market signals about which wools are better for processing and therefore worth more money to their customers.
The knitwear sector continued to match the fleece types with solid gains for medium micron pieces and bellies containing moderate VM, while cardings were stronger across the board.
Crossbred wools also found good support both here and across the ditch with increases of up to 30c.
Demand is not exactly buoyant at the moment, and new sales in most markets are hard to come by.
However, the processing juggernaut rolls on mindful of the one week recess coming and the need to keep supply topped up in front of machines until the northern hemisphere shearing begins in a couple of months.
Growers are understandably keen to get any newly shorn wool into market at present, and this will challenge the cash strapped buying fraternity.
Prices of wooltops and yarn are starting to be offered on a two-tier basis depending on shipment required allowing for an easing of the market in May/June as topmakers and spinners try to maintain their order books.
The discounts are not huge at this stage, and virtually line up with the published prices on the Riemann futures market, where the normal cost of interest and storage is factored into prices.
Other markets around the globe, outside of China, are continuing in full production mode at present, and are more concerned about prompt deliveries than future purchases.
There is still a very good vibe around trade and the new products that have been exhibited are generating a lot of enthusiasm.