Twenty yr premiums for 15 and 17 micron wool to 21 micron (all in public sale averages used quite than indicators) are sitting round their twenty fifth to thirtieth percentile ranges in proportion phrases, and in deflated cents per kg phrases their thirtieth to fortieth percentile ranges. They don’t seem to be desperately low, and never as excessive as many would love.
One of many challenges in taking a look at micron premiums and reductions has been the downward pattern within the common Australian merino fibre diameter since 1990. The micron distribution of the merino flock has been altering. To get round this the typical merino fibre diameter has been calculated and from {that a} finer (2 microns finer) and broader (2 microns broader) value sequence has been extracted, so as to observe the micron premiums and reductions across the common merino micron.
Determine 1 exhibits the distinction in value (in Australian and US greenback phrases) between the 2 sequence, which is successfully a 4 micron vary, which straddles the typical merino micron. The sequence runs from the early Nineteen Eighties to this month. The Australian greenback sequence is presently round its fortieth percentile for the previous twenty years as proven within the schematic. When adjusted for inflation the rating drops again to the twenty seventh percentile, whereas in proportion phrases it’s on the twenty fifth percentile.
Determine 2 exhibits the identical micron premium, in proportion phrases. From a relative perspective the premium is at a low stage (~20%) after being at round 100% in 2021-22. Historical past exhibits these micron premiums and reductions to be risky, swinging from excessive to low and again to excessive ranges pretty ceaselessly.
Altering provide, usually pushed by cyclical seasonal circumstances and aided by extra gradual tendencies in manufacturing pushed by farmer selections, is the massive issue behind pretty common swings in micron premiums and reductions. Demand is available in to amplify or reasonable these swings.
Determine 3 exhibits the value premium from Determine 2, taken from 2013 onwards, together with the yr on yr change within the rolling 12 month whole AWTA volumes for 16-18 and 20-22 micron wool. The 2012-2016 interval was a uncommon prolonged time of depressed positive wool premiums, though the elevated provide of 16-18 micron wool and decreased provide of 20-22 micron wool which might have pushed down on positive wool premiums did lengthen into 2015.
Since 2017 the relative swings in positive and broad merino have been information to the course of the anticipated pattern in premium, if not the magnitude. Since mid-2025, when positive wool volumes have been easing, the relative change in quantity exhibits the 20-22 micron volumes to be falling by excess of the 16-18 micron. This implies there was comparatively extra 16-18 micron wool on the market, which has put downward strain on the premium.
