Sydney sells its smallest wool offering on record

Sydney wool offering smallest on record

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Elders Sydney wool technical manager Craig Brennan says growers are choosing to hold onto their wool at the moment to avoid the falling market.

Elders Sydney wool technical manager Craig Brennan says growers are choosing to hold onto their wool at the moment to avoid the falling market.

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Australian wool prices are continuing to fall, as is the amount of bales being offered for sale.

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Australian wool prices are continuing to fall, as is the amount of bales being offered for sale.

On Tuesday and Wednesday last week, just under 25,000 bales were catalogued.

While this amount was up almost 7000 bales on the week before, it brought the season total to 1,278,186, which is 127,906 or 9.1 per cent down on the same time last year.

At the northern market in Sydney, only 4696 bales were offered - the lowest weekly offering in Sydney since Australian Wool Exchange records began in 1997/98.

AWEX reported in its weekly market report that the reduced offering did help increase buyer demand, but main buyer focus was on the better style wools and those with favourable additional measurement results.

As a result, the industry benchmark Eastern Market Indicator (EMI) fell 20 cents a kilogram for the week to average 1272c/kg.

This time last year the EMI was at 1943c/kg.

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Elders Sydney wool technical manager Craig Brennan said the reduced offering was to do with the drop in the market.

"A lot of growers are electing to hold onto their wool and not put it into the marketplace and wait and see if down the track the market recovers," Mr Brennan said.

"So the majority of wool that's coming through is going straight on hold."

He said even with the reduced offering, prices were lower, and he blamed that on coronavirus.

"The issues are with COVID-19 and how it's affecting all of the world," he said.

"What we're seeing is a lot of mills that can't produce any garments because shops are closed.

"No one's spending any money, so consequently, everything's slowed up."

He said it was a "huge issue" and that we were in "unknown territory".

"We've never been in this predicament before," he said.

"Obviously [COVID-19] isn't directly impacted by the wool industry, but it's dramatically affecting our business."

He said of those that did decide to sell despite the uncertainty, a fair amount passed their wool in when they saw the prices offered.

AWEX reported that 15.2pc of the offering was passed in.

While this was down 8.1pc on the week before's pass in rate, it was still a significant amount.

Mr Brennan said at the moment, the future was unknown.

"We're waiting to see as countries overseas like Europe and China start slowly getting clearance to get workers back in factories and people back out on streets and shopping," he said.

"Hopefully then we'll start to see some recovery.

"But the timeframe on that is unknown."

AWEX reported that the large selection of lesser style wools and those with poor additional measurement results lost ground as the sales progressed.

The individual Micron Price Guides (MPGs) generally fell nationally by 2-50c/kg.

The only exceptions were the finest MPGs in each centre, which recorded modest upward movements.

It is expected that this week's national offering will increase slightly on last week's, yet due to supply issues in Sydney, only a one-day sale will be held there.

Melbourne and Fremantle will sell on Tuesday and Wednesday.

The story Sydney sells its smallest wool offering on record first appeared on Farm Online.

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