Wool market lacklustre

24th September 2026

THE  Australian wool market continued with its lacklustre performance this week losing a further 12 cents across the week although again the fine and superfine market was very well supported while the medium merino segment struggled.  In contrast to previous seasons where the dramatic lack of supply of medium wools has kept these prices close to the superfine types better seasonal conditions are seeing a relative shift in supply.  The good seasonal conditions are increasing the cut per head and broadening of the clip profile, albeit with an ongoing reduction in sheep numbers.  Analysis from Independent Commodity Services highlights that with the fall in merino volumes as per AWTA testing for July/August this year of 5.4% together with an increase in clean fleece weight of 1.6% points to an overall fall in merino sheep numbers of 7% so far this season.

So the trend for production is still falling, which was clearly highlighted to world trade in China last weekend by visiting growers, but the market continues to drift down as demand has yet to kick in for the current season.  In USD terms the market also lost 13 US cents, whilst in Euro the currency movements led to an unchanged market price for the European fraternity, most of whom are still sitting on the fence awaiting direction, although this week’s “Newcastle” sale did provide them with the opportunity to purchase a few selected clips in the Sydney offering.  Chinese buyers after being visited by travelling exporters from Australia and South Africa either side of the Nanjing Conference saw only a very small change in market prices according to the published EMI report, although again the differences in quotations this week ranged from unchanged to minus 40 US cents depending on their appetite for sales.

Some business was concluded by the travelling exporters although it was not at the same volume of previous years given the headwinds being experienced on the demand front.  This week’s gathering at the UN in New York has highlighted the fragmentation on the global scene with many fires still burning out of control and coupled with increasing bond yields across the globe consumers face a pretty dire outlook for the next few months.  Still the wool market is in pretty good shape compared to a year ago and fine merino in particular isdoing well at a retail level.  Those pushing a blended product are arguably struggling more as the lower price point they were seeking is under threat from rising synthetic fibre prices as well as high wool prices, so cheap textile garments are just a tough gig at present.

Processing quality is becoming more important as selective buyers search for value and the increasing volume of over-long medium merino wool is hastening the price downtrend for these micron types.  Good seasonal conditions are no doubt contributing to the extra length, as has the breeding strategy over the past few years, but we are seeing a push-back from the processing fraternity at present which is likely to continue and gather pace until market conditions improve.  Some of the medium merino is used in knitwear, but the majority is destined for the woven fabric sector where demand is reported as low, but stable. One or two large uniform orders from China can change this overnight, but with China’s government continuing to be very selective about where it throws cash we may have to sit and wait for a while.  The price resistance chatter from the suit fabric trade has lessened, but not gone away, so until they see more meters of fabric moving off the shelves they will remain reluctant to restock the supply chain above minimum levels.

The knitting sector concentrated around 17.5/18.5 micron continues to be the driver of the merino market and whilst there are still some quality parameters being demanded as well as required certifications in some instances we don’t appear to be producing too many wools which are causing problems for the processing trade.  With demand for both long and short wooltop the knitwear trade has a good appetite for pretty much all of the wool being offered at present, although with nearly 32,000 bales in Australia next week and South Africa also returning to the fray the depth of this appetite will be tested.  The currency at present will be helpful for Aussie growers having dropped a full cent overnight, but where it will be come Tuesday is anyone’s guess.

So as we farewell September and move into October the seasonal trend should become more favourable but firstwe need to move past the Chinese National Holiday period which some will take as an opportunity to avoid buying commitments.  Whilst some parts of the globe have moved into autumnal conditions mainland China is still experiencing warm to hot weather and in some parts of Asia typhoons are still disrupting life making it difficult for consumers.  With all the bickering and name calling coming out of New York’s UN convention this week it is fairly easy to see why people may be inclined to keep their hands in their pockets rather than hitting the ‘buy’ button on their keypad at present, but it is the longer term outlook that matters to the wool industry with its long winded pipeline so looking ahead to 2027 rather than next week it what matters most.

From that aspect things do look a little rosier and given the virtually empty pipeline in the early stages at least there will soon be pressure on processors to step up to the plate.  It would seem that they have another week or two at most, with some already saying that they are seeing slightly better enquiry but others are ‘looking under rocks’ for clients who have fallen off the radar.  So we will probably see another ‘rinse and repeat’ for the market next week but it may be affected by the currency market as well.

Damien Whiteley, Elders District Wool Manager