Wool horror show continues with EMI sliding 122 cents a kg

Wool prices in freefall as EMI sheds 122 cents a kg

Sheep
PRICES IN A HOLE: The wool market has been battered again this week by global economic uncertainty which has hit consumer confidence.

PRICES IN A HOLE: The wool market has been battered again this week by global economic uncertainty which has hit consumer confidence.

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The freefall in the wool market resumed this week with the Eastern Market Indicator shedding 122 cents a kg clean.

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The gut-wrenching slide in the wool market gathered pace again this week with the Eastern Market Indicator (EMI) losing 122 cents a kilogram to finish at 1375c.

The pass-in rate soared to 34.8 per cent while 18pc was withdrawn prior to sale which cut the weekly offering to just 26,420 bales in Sydney, Melbourne and Fremantle.

Only 17,221 bales were sold for $26.12 million as world economic uncertainty, headed by the China-US trade war, continued to sap consumer and business confidence.

US President Donald's Trump's erratic messages on America's trade row with China are at the forefront of the lack of confidence among Chines processors who have been buying 75pc of the clip.

Rabobank senior analyst for animal proteins, Angus Gidley-Baird, said at this week's National Merino Sheep Show and Sale in Dubbo that it was "anybody's guess" where the wool market would end up.

However, Rabobank's group executive for country banking Australia, Marcel van Doremaele, also speaking at the Merino national, said wool stocks in China weren't high and he believed prices would recover quickly once the current trade rumbles were resolved.

EMI SINKS: The Eastern Market Indicator plummeted by 122 cents a kg this week to reach 1375c.

EMI SINKS: The Eastern Market Indicator plummeted by 122 cents a kg this week to reach 1375c.

In its national weekly market report AWEX said the rapid downturn in the EMI had created trading difficulties for exporters.

"Buyer confidence has been severely dented by the falling market. This series, as buyers accumulated wool, they continually reduced their basis," AWEX said.

"This resulted in the market being unable to find a solid level and prices were consistently reduced as the week progressed.

"The continual fall in prices pushed the Micron Price Guides (MPGs) generally down between 100 and 170c, 18.5 micron and finer were least affected as buyers looked to secure finer wools."

During the previous four sales the EMI has fallen by 379c or 21.6pc.

Compared with the same sale of last season, the EMI has now sunk by 715c or 34.2pc.

The crossbred sector was the best performer again this week, shedding between five and 25c.

Cardings also suffered big falls with Sydney and Melbourne down 90 to 140c a kg and Fremantle plummeting more than 200c.

All three Merino carding indicators have now lost close to half their value in 12 months.

AWEX said more sellers were adopting a "wait and see" approach and next week's national offering was now sitting at 29,061 bales.

The story Wool horror show continues with EMI sliding 122 cents a kg first appeared on Farm Online.

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