EMI hits record levels against synthetics and cotton
- Category: Industry News
With the recent lift in prices for Merino wool and a higher A$ against the US%, the EMI has risen by 75 UScents or almost 7% since the start of the season. The EMI is 22% higher in US$ than a year ago. Prices for other fibres have been much less volatile than the prices for wool. Cotton prices have slid since July and remain a little below year earlier levels. Synthetic fibre prices have eased higher since June, although they are 11% higher than a year earlier. As a result of these changes, the ratio of the EMI compared with the major competing fibres has risen to record levels. The current EMI compared with synthetics has risen steadily to be 6.51 in August, the highest recorded since the start of the series in January 1991. The current level is also well above the average ratio since 2010 (which is 4.74). Furthermore, the decade averages have lifted steadily, with the average in the 1990s at 3.19 and in the 2000s at 3.68. The EMI is now at 7.1 times the price of cotton, after a very sharp rise in the past two months, to a record level. The average ratio since 2010 is 5.28, which is substantially higher than the average of 3.13 in the 1990s and also higher than the 2000s average of 4.63. The question is how long these extreme price ratios for the EMI can be sustained?