Wool prices have again dropped this week in Australia, whatever the fall of the local currency. Poor quality levels of drought-affected wool may have depressed demand.
Wool prices have fallen for the second consecutive week with the benchmark indicator losing 8 Aussie cents per kilo clean at 2,008 cents (-0.4%).
A significant decline of the Australian dollar has not supported the market which has decreased by 26 US cents or 1.75% and 1.28 yuan or 1.3%.
Demand has been actually weakened by the low quality levels of many lots on offer which have been affected by the drought.
Over the long term however, the fall of Australian production should continue supporting prices.
The decline of the Australian dollar in yuan terms in the past weeks could also have boosted demand which is now mostly originated in China.
Source: Emergingtextiles
