The return of the nations wool auctions after the three-week winter break saw thousands of bales passed in as prices tumbled.
I caught up with Steven Read from Michell Direct Wool on Country Viewpoint on Friday for our regular run down of the week that was.
57,000 bales were put up for auction last week and Steven told us that only 49,000 went to the trade. Right from the outset prices began to fall leading to 33% of that being passed in. The overall market fell 56 cents to finish at 1372 with Merino Fleece, cross breeds and cardings all feeling the pinch.
The market wobbles came straight from the orient with China experiencing a rise in coronavirus cases sending shudders through production estimates. Steven said that Chinese authorities have worked out that the delta variant is much tougher to contain than previously thought.
"This one (the delta outbreak) has really put a scare through the markets up there," said Mr Read.
"The Chinese government had been placing orders for government uniforms earlier in the year to help pump prime production and they may well have over cooked that".
Steven said it was unlikely that an uptick in production in other parts of world such as Europe and South Korea will be able to stop the market slide.
"Alone they can't absorb the Australian wool clip," said Mr Read.
"All the markets outside of China added together are less than 15% of total early stage processing for wool".
It wasn't all bad news however with Steven pointing out the prices are still solid compared with long term averages. Steven was kind enough to run through a series of bale prices for 21 and 19 micron fleece and a host of other grades. Check out those bales prices by listening to the podcast posted earlier in the story.
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