Wool Market Update (November 2023)

The following large graph shows the AWEX Eastern Market indicator (EMI) in cents per kilogram clean, from 2014 to date.

The wool market has remained relatively steady with the EMI hovering in the 1,100-1,200 c/kg bracket for the past 5 months. During this period the price has declined with finer micron wools still suffering the greatest falls. 17 micron wool has experienced a price reduction of 15% over this period, while 21 micron wool has declined by only 4.5%. Year on year the EMI has decreased by 10%. In comparison, 17 micron wool has decreased by approximately 25%, 21 micron wool by 1.8% and 28 micron wool has increased by 9%.

The change in micron differentials over time, is illustrated by the following graph, published by Profarmer.

It is worth noting that fine wool is coming off a very significant premium and has only just returned to the long term micron price differentials.

The falling demand for the finer end of the market has been attributed to the depressed global economy reducing demand for luxury woollen items. In addition to this, domestic wool production is up significantly on previous seasons, due to an increase in the flock size plus good seasonal conditions during the past 12 months.

With the EMI currently sitting at 1,129 c/kg clean, this should result in net average returns to clients with 19 micron Merino clips, of around $8.98/kg greasy assuming a yield of 65%. This would produce a return of $53.89/head net for sheep cutting 6.0 kg/head greasy.