The 2007/2008' National wool selling season kicked off this week amid much uncertainity, during the 3 week July break from sales the Australian dollar pushed up to 89 US cents and concern over Chinese quota's  lead to large falls across all micron categories. Although the dollar fell back to under 86 cents at the start of the week, there had been very limited business done during the break and exporters were reluctant to buy until real demand could be seen.

         Falls were general across all microns and categories of between 50/80 cents clean per kilo, even cardings which had been the star performer for the past 6 months suffered the same fate. Most exporters had little or no forward sales to cover and were reluctant to buy until China showed some real interest, as a result passed-in and withdrawn rates were high as growers were also reluctant to sell. It is worth remembering that price levels are still 100/150 cents higher before sales this week compared to the same time last year.

          Wednesday's sales found the bottom of the market and by Thursday most types were 5/10 cents dearer with the exception of 19.0 micron and finer wools which were 20/30 cents dearer. A few Chinese mills started to buy again and now there seems to be a bottom of the market for the time being we would expect more Chinese mills to also resume buying. As I have mentioned previously with our reliance on China who buy 60/70% of the Australian wool clip, volatility is a reality of today's market. Expect next week to be slightly dearer again with only 43,500 bales offered Nationally.