WOOL prices took an unexpected dip last week with the Eastern Market Indicator closing down 12c/kg at 878c/kg clean.
Exporters and brokers were hoping prices held steady prior to the three-week auction break.
But Australian Council of Wool Exporters chairman and the head of Queensland Cotton's wool exporting business, Michael Avery, said the price fall could have been greater given the larger-than-expected offering of 39,700 bales.
Mr Avery said the market was reflecting the economic uncertainties.
"I suspect that this volatility will be with us for several more months," he said.
But despite the falls of recent weeks, Mr Avery said the wool market had remained relatively stable since Christmas with the EMI moving within a 6-7 per cent or 60c/kg range, whereas the Australian dollar fluctuated 12-13 per cent during the same period.
Mr Avery said Chinese consumption, particularly from its middle class, was now a major driver adding to the traditional demand created by its army and public servants.
Australian wool auctions resume on August 11.
