Wool prices have surged this week in Australia after China has imposed a ban on imports of greasy wool from South Africa. The wool indicator has risen above 2,000 A$ cents for the first time since last October.
Wool prices have sharply rebounded this week in Australia after Chinese authorities have decided to ban imports of greasy wool from South Africa.
The Chinese ban was due to an outbreak of foot and mouth disease in a remote part of the country.
Buyers have immediately shifted to Australia, therefore boosting demand and prices which were already expected rising in the current week.
The benchmark indicator has jumped by 59 Aussie cents per kilo clean, up 3% and crossing the symbolic barrier of 2,000 cents for the first time since last October.
A rise of the Australian dollar has resulted in the same EMI gaining 51 US cents or 3.6% whereas the wool indicator was only rising 2.6% in yuan terms and 3% in euro terms.
The South African production only accounts for about 6% of global wool output and 9% of merino production with the impact of the Chinese ban therefore expected to be limited beyond the immediate reaction.
Source: Emergingtextiles
