WITH the Eastern Market Indicator at a record 1699 cents a kilogram and the auctions preparing to shut up shop for the Christmas break, confidence abounds the market will stay strong into the new year.
Greg Andrews, Schute Bell's northern wool manager on Tuesday afternoon said there was a strong chance the year’s last sales could again set a new record.
"There's every possibility it will," he said.
Mr Andrews based his confidence on the fact there are no big reserves of wool, so current shearings are feeding the market and the run into Christmas is not peak shearing time.
Mr Andrews said if there was any sort of weakness in the market it would be in the 27 micron and broader range. The hottest property was the sub-20 micron range, he said, and that was fashion industry driven demand for light weight fabrics.
Australian Wool Exchange market information manager Lionel Plunkett said buyer interest was intensifying with the opportunity to fill orders diminishing quickly.
He said all types and descriptions across the entire Merino spectrum enjoyed a boost in price as buyers fought hard to secure market share.
At Sydney sales last week the Northern Market Indicator gained 26c/kg to hit 1782c/kg, while in Melbourne the Southern Market Indicator lifted 20c/kg to settle on 1646c/kg.
“Wools possessing favourable length and strength results continue to attract the greatest competition, however even lots with poorer numbers managed to achieve similar gains.”
The crossbred sector also managed to reverse its downward pricing with solid gains. Mr Plunkett said there were general price increases of 20c/kg to 55c/kg, providing welcome news to growers of these broader types.
Landmark NSW northeast wool manager David Hart said there was much optimism heading into the new year, but history had taught growers to temper any pevailing positive market sentiment with caution. He said market desire for superfine wool had begun in November last year and had stayed the course. “But it’s been a long time coming, too long for many growers. He said one of the unknowns going into 2018 was how much wool had been sold this year that would normally be sold next year. “There’s a reasonably large potential for a supply squeeze.” Also, the December 22 payment date for exporters was making things difficult, he said.
“December 22 is a Friday and backing hard onto Monday as Christmas Day we’ve extended payment dates by seven days for exporters, but will still pay growers as per normal to give exporters a chance to meet their shipping requirements,” he said.