During the week ending December 5, 2025, the Australian wool market exhibited characteristics of "increased volume, stable prices, and structural divergence." Overall trading activity improved compared to the previous week, but price movements remained constrained by multiple factors, resulting in a narrow, range-bound pattern.
In terms of price trends, the Eastern Market Indicator (EMI) fluctuated slightly between December 1 and 5, closing the week approximately 1% lower than the previous week. Priced in Australian dollars, the average price for 21-micron quality Merino wool remained stable within the range of AUD 12.4–12.7 per kilogram. Performance varied across market segments: Superfine wool (19-20 micron) prices remained relatively firm due to tight supply and support from high-end apparel orders, while medium-to-broad wool (23 micron and above) faced slight downward pressure as demand for workwear and carpets remained weak. Fluctuations in the AUD/USD exchange rate and international wool inventory levels continued to directly impact offshore prices for Australian wool.
Regarding trading volume and market sentiment, the total auction offering for the week was approximately 48,000 bales, with a clearance rate holding steady at around 85%, indicating sustained underlying demand. The main buyers were still major Chinese topmakers and some long-term European users, though their bidding remained cautious, primarily focused on "purchasing as needed" for near-term production rather than large-scale stockpiling. Buyers from India and Southeast Asia showed higher price sensitivity, concentrating their purchases mainly on mid- to lower-priced wool.
Market Drivers and Outlook: The short-term market lacks a clear, one-sided driver. Positive factors include drought conditions in some Australian regions affecting supply expectations for the new season and raw material stockpiling by China for spring fabric production next year. Constraining factors involve the ongoing recovery of consumer confidence in textiles and apparel within major global economies, high retail inventories in Europe, and substitution effects from competitively priced synthetic fibers. Overall, the market is expected to maintain a state of "weak supply-demand balance" leading up to the year-end holidays, with insufficient momentum for significant price increases. However, high-quality fine wool is likely to demonstrate strong resilience due to its scarcity. Moving forward, close attention should be paid to import policies in key consuming countries, exchange rate movements, and the release pace of global procurement orders for the first quarter of 2026.
