Wool auction markets in Australia saw a positive trend. The key driver behind the week’s push was new demand from China. Australian dollar exchange rate against all major currencies, particularly the US dollar, was also a factor. US dollar strengthened relative to Australian dollar by nearly three per cent.
While the price rise during the week was widely expected among the trade, the velocity and magnitude of the gains were not forecast and surprised most. It was common knowledge around the show floors pre-sale that new business had been written and many orders remained unfulfilled, as exporters were reticent to expose themselves to an open short position. As the week progressed, and buyers’ stocks moved back into positive territory, some profit taking did occur and new orders were concluded mid-week, somewhat satisfying prompt demands.
Better wools across all wool types were still being well sought after and it was only the average to inferior descriptions and lots showing hard to place test measurements that displayed this nervousness. It was a staggering week of good fortune for wool growers who were selling. The price rises were in many cases extraordinary especially for those ultra fine types finer than 16.5 micron.