Double the volume and higher prices as the AuctionsPlus Wool market heats up

The AuctionsPlus online offer board for wool has seen a sharp increase in purchasing activity and listed volumes over the past two weeks. Results recorded on March 15, revealed the volume of bales sold on AuctionsPlus has increased by 54% from the entire month of February, with prices also experiencing an uptick.

In the first half of March, AuctionsPlus sold 724 bales, totalling 132,790 kg, with an average sale price of 1493c/kg and a greasy wool price averaging 1035c/kg. This marks a significant jump from February’s total of 469 bales sold (85,000 kg), which fetched an average sale price of 1420c/kg and a greasy wool price of 988c/kg.

This surge in online sales aligns with an uplift in the broader Australian wool market, demonstrating its growing role in facilitating transactions. The Eastern Market Indicator (EMI) has shown upward momentum, while physical auction markets have also reported increased buyer confidence.

Across the month of March so far, a broad range of microns have dominated the offer board from a low of 13.8µ micron to a high of 24.7µ micron. Overall, the top price this month was a Nutrien Melbourne lot that sold for 1,750c/kg greasy. This BELTANA branded SUPPCS (superfine Merino pieces) was 13.8µ micron and had 8% vegetable matter.

There are currently several Merino stud sales and commercial stock listed on AuctionsPlus, and it will be interesting to see if the uptick in wool prices translate to higher prices and greater clearance in these sales.

The Australian Wool Innovation Limited (AWI) weekly market update from the fortnight ending March 14, highlighted a firming market where prices remained in sellers’ favour.

“Wool prices at this week's Australian wool auctions were once more fully to the seller's favour,” according to AWI.

“From the outset of selling, buyers were as keen if not keener than last week, but only after an initial period of testing the atmosphere to see any signs or chance of more opportune buying.”

The report further indicated that Merino wool remains the standout performer, with 19-micron and broader wools appreciating by 25 to 35c/kg clean over the week.

Demand for finer wool (below 18-micron) has also intensified, though a concerning price gap persists between top-quality and lower-end offerings. While the best wools traditionally attract premiums in the luxury apparel sector, these differentials have not been as pronounced as expected.

Quality concerns remain at the forefront, with buyers and exporters closely monitoring supply conditions. Drought-affected wool-growing regions are producing lower-strength and lower-yielding wool, increasing the proportion of harder-to-place lots.

With more processors seeking value, these wools may find a niche in production runs. With 41,000 bales expected on offer this week, the auction results will test the resilience of current demand.

Meanwhile, ANZ’s recently released Autumn Agri InFocus report underscored the shifting dynamics in the Australian wool sector, stating that wool prices had staged a recovery over the past quarter following a prolonged downturn. However the report highlighted a concerning trend that Western Australian producers are increasingly exiting or reducing their reliance on sheep production.

According to ANZ, the price rebound has been driven by a combination of favourable exchange rates, reduced auction volumes, and tentative signs of strengthening demand. High mutton slaughter rates and declining year-on-year wool test volumes suggest a future contraction in wool supply.