The domestic downstream yarn market increased in volume

This week, the Australian wool market experienced a significant upward trend, with the average wool price rising by 1.1% across auctions in Sydney, Melbourne, and Fremantle. The Australian dollar also strengthened against the U.S. dollar, climbing by 2.1%. Chinese buyers remained the strongest force in the market, followed closely by European, Indian, and Taiwanese purchasers. Notably, Italian buyers showed strong performance this week, securing several high-quality lots. Meanwhile, in New Zealand, approximately 9,000 bales of wool were offered on the North and South Islands. Despite ongoing monetary policy challenges, auction prices held firm, achieving an impressive turnover rate of 89%. Key buyers included China, India, the Middle East, and the UK, with additional support from Western Europe and Australia. In South Africa, the second week of the wool auction saw continued strength, particularly for Merino wool. The Cape Merino Index rose by 0.9% from the previous auction, closing at 58.26 rand per kilogram (net hair). This increase was driven by a stronger euro, limited supply, and a weaker rand. The rand fell 1.4% against the U.S. dollar, reaching 7.31, while its value against the euro dropped 0.5% to 9.3 rand. Looking ahead, analysts suggest that the global demand for high-quality wool remains robust. In the domestic market, the downstream yarn sector saw increased trading activity, with most products flowing into the apparel segment at stable prices. Dong Linyi, an analyst from woolmarket.toocle.com, notes that the growing transaction volume in the yarn market is likely to sustain the upward momentum in the wool sector. With strong international demand and tight supply, the market is expected to maintain "narrow fluctuations" in the coming weeks. Overall, the wool market continues to show resilience, supported by both local and global factors, making it an attractive space for buyers and investors alike.