The Australian wool market found some legs last week, experiencing a strong jump on the back of renewed demand from China.
There was also a sprinkling of inquiry from other destinations.
Attention was on superfine Merino types, with any lots finer than 18.5-micron strongly sought after.
These categories had price increases of up to 100 cents a kilogram - and even a little more in the Sydney market, which was playing catch-up to Melbourne's extra selling day during the previous week.
Fine micron Merino types followed along, but in a more subdued manner.
The medium Merino categories struggled to move forward, but these may be in for a change in coming weeks.
The gap in price between 17 and 21-micron wool is now more than $10/kg and exporters and topmakers will be under pressure to deliver exactly on specification - but not above.
The typical accepted tolerance of plus or minus 0.3-micron now equates to up to 75c/kg, which is way above the usual exporters or topmaker's margin.
A difference of $5/kg is a much more long-term "normal" basis between 17 and 21-micron types.
So, natural market forces will most likely kick-in at some point to reduce the extreme premium between the superfine and medium categories.
Of course, demand for medium Merino wool has to show-up for this to happen.
But, given that a degree of the current demand spike is due to a particular Chinese uniform order, it would not be unexpected to see further uniform orders in coming weeks that support the medium sector as well.
In general, the Chinese uniform business has a tiered approach.
The top brass of whichever organisation it is going to gets 17.5 and 18.5-micron cloth and the lower grades of pay are provided with 21 or 22-micron, polyester-blend fabric.
The current order is said to be for the police force and is a round of new ceremonial outfits being made in preparation for the 100-year anniversary of the Chinese Communist Party celebrations, which kick-off later in the year.
Of course, the army and other security forces will not want to be "shown-up" by the police in their "fancy" gear.
So, it is a safe bet that all of these public-facing organisations will get a new uniform to look their best.
This is good news for the wool industry.
But exactly when the orders will be issued is not something that is broadcast, or able to be factored into production planning - such is the way of Chinese government procurement operations.
Meanwhile, growers producing crossbred wool are looking longingly over the fence and wondering when their product will get a boost.
The 28-micron price guide is sitting at the 50th percentile for the past 30 years, which means it has been better than this 50 per cent of the time in the past 30 years.
A boost of $3/kg would take it up to the 95 per cent level, and even $1/kg extra would see it about the 70 per cent level - where many growers of other commodities would be thinking of locking-in a forward hedge.
No doubt something will come along to boost the demand for crossbred wool down the track - probably just when the quantities begin to drop off again from seasonal highs.
We are already seeing a resurgence of activity at the coarse end of the market, with New Zealand carpet wools having lifted off the bottom - mainly as a result of being too cheap for too long.
There is also starting to be a renewed interest in crossbred wool for products such as insulation.
But these products are particularly price sensitive and, despite the eco-friendly concept of cladding one's house in wool, the numbers don't stack-up when the price is above the long-term 50th percentile.
Consumer interest in hand knitting yarn, wool/acrylic blend jumpers and beanies - as well as upholstery - needs a boost for the demand cycle to kick-in for 28-micron wool. A decent cold winter in the Northern Hemisphere would also assist this process.
Alternatively, we could sit and wait for a new product such as "fake fur" to come along again - as this provided the demand spike last time.
Those further along the pipeline will decide this, not the buyers sitting in the auction rooms across the country, or even the topmakers and traders looking for a way to cheapen the products they are putting together.
Knitters and garment makers are starting to prepare their collections for the autumn-winter season in the Northern Hemisphere.
They are planning what will go into these collections and trying to read the minds of their customers and the consumer to get a head-start on production.
Waiting until orders are actually in-hand is just not a luxury that can be afforded to many. So, they need to take a guess.
Many factors come into play, but the price relativities between different fibres is always front-of-mind.
Having crossbred wool prices so cheap compared to Merino, particularly superfine Merino, will get the creative juices flowing.
With the addition of a bit of silicon softener, or a Basolan treatment to enhance the hand feel, a wool-acrylic yarn can be made to feel pretty good - at least for a while anyway.
But while those playing at the broader end of the clip get on with their thing, those operating in the Merino world are sitting back and wondering how long this will last.
With a few more uniform orders expected to hit the books, and many operating in the Chinese knitwear scene already clocking-up their best quarter ever, noone wants to mis-step and get on the wrong side of the market.
Is the outlook strong enough to load-up with stock yet?
Or will supply suddenly come flooding out of the woodwork and drown the market?
Are the consumers in America going to offset the quiet European situation?
And will the Tokyo Olympics actually get off the ground and resurrect the Japanese market?
There are many questions that are being pondered by the trade overseas at present.
Some have decided on a strategy, but many are waiting for more certainty.
- ELDERS WOOL