Australian wool prices are rising ahead of the industry’s first week-long break for the Lunar New Year.
The industry benchmark Eastern Market Index (EMI) rose 16 cents this week to 1,693 cents per kilogram, its highest level since 2019.
EMIs have now increased by 152c/kg (10%) since the beginning of this year.
Australian Wool Innovation (AWI) said in its weekly review that “robust price growth” was occurring despite the strength of the Australian dollar.
According to the report, China’s market share has increased to 88.4% of Australian wool exports, but one of the main factors determining prices is Australia’s supply is decreasing.
The report said: “Given losses in Australian wool production, over the past two years the amount of wool grown in Australia has declined on the scale of the entire South African wool clip.”
Both the Western Market Index (WMI) and the Eastern Market Index (EMI) indicate that wool prices are increasing. (ABC landline/AWI)
Vacation for Chinese New Year
AWI’s international general manager Stephen Hill said wool auctions will be taking a week off during the Lunar New Year period, a first for the industry.
“For the past 15 years or so, China has become a major destination.” [for Australian wool] And now it accounts for more than 85 per cent of wool exports,” he said.
“The Lunar New Year is the most important holiday in China. [buyers] I would love to take a week off and relax and not worry about business.
“Therefore, we were able to meet this reasonable request from our major customers.”
Sales will resume from February 24th.
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genuine demand
Mr Hill, who was in China last month, said the outlook for future demand was positive, with wool entering traditional categories such as men’s wear as well as emerging markets such as sportswear.
“Wool is definitely trending and we’re seeing demand across the board,” he told ABC Landline.
“There are a lot of new categories that use wool.
“Currently, so much wool is used in blends; wool cotton boom …And even though the blend percentages are low, they are in the mass market realm and sell in high volumes. ”
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