KNITWEAR is fast becoming the strength of the wool market.
While the demand for executive suiting, which is heavily dependent on superfine worsted fabrics, is bearing the brunt of the global financial crisis, it is a different situation for low-value knitwear apparel, especially in China.
That's the view of exporters who are seeing the emergence of two different markets in recent weeks, particularly in the strength of demand for carding, crossbred and broader Merino wool types, most of which are bought for knitwear.
While the Eastern Market Indicator closed last week down another 3c/kg to 722c/kg clean, it masked larger falls of 10-17c/kg in the superfines, while the broader Merino, carding and crossbred indicators held firm.
Superfine specialist exporter G Schneider said the weak demand for worsted types was reflected in the Newcastle offering of 17,000 bales where buyers were no longer paying the usual premium for the better or spinner-type wools.
Exporter and processor BWK Elders said the strength of the crossbred and carding market was being led by domestic sales of apparel in China, which previously would have been exported.
BWK Elders said as part of programs to boost industry, some Asian governments were encouraging orders for police, banking and school uniforms, which in turn was helping the wool market.
In Melbourne last week, veteran Macarthur grazier Tom Laidlaw was taking advantage of the knitwear demand to sell more than 100 bales from his Corriedale flock.
Prices for his high-yielding 23-28-micron fleece lines made 400-458c/kg greasy.
And while these prices were about 50-55c/kg or 10 per cent cheaper last year, they were not as bad as the 25-30 per cent falls being experienced by the superfine Merino offerings.
Mr Laidlaw said he had always been a Corriedale man.
"It's too wet for Merinos where we are," he said. "And I don't like having to buy in crossbred ewes (for prime lambs)."
But despite his support for the Corriedale, he said he would like to boost both his 85 per cent lambing percentage and 4.5kg wool cut.
Mr Laidlaw's agent, David Morgan of Landmark said the knitwear demand was also helping the broader Merino types.
"The broader Merino, with its ability to produce a prime lamb, is now the most profitable of the Merinos," Mr Morgan said.
Wool sales continue this week with a national offering of 51,300 bales, including 18,700 bales in Melbourne.
