Bendigo Bank Agribusiness’s latest Monthly Commodity Update reports that tightening supply and a shift away from synthetic ‘fast fashion’ is driving a surge in the Australian wool market, while avocado supply is bracing for a dive.
“The Australian wool sector is currently enjoying a sustained period of growth, driven by demand for natural, sustainable year-round apparel – not just for winter warmers,” said Bendigo Bank Agribusiness Senior Manager Industry Insights, Eliza Redfern.
“Expanding beyond traditional winter wear, the fibre’s temperature control properties are securing its place in summer and technical apparel. With supply constrained, this strong pricing is expected to hold into the 2026/27 season,” she said.
This pivot back to natural fibres, combined with increased costs for synthetic alternatives and a tighter supply picture, is reflected in the AWEX EMI – currently sitting at 1,886 c/kg – 58.4 per cent higher year-on-year.
The broader agricultural sector faces a mixed and complex outlook as it transitions into the winter months, Ms Redfern said, with avocado supply about to fall significantly.
“Following a bumper season in Western Australia, the market is bracing for a reduction in avocado output as the harvest moves to Central Queensland, with the anticipated drop in regional yields expected to tighten overall national supply and strengthen farmgate returns,” she said.
“Consequently, Hass avocado retail prices – currently between $2.20-$2.75 per piece – are forecast to lift as high as $3.50 as the winter season progresses.”
Other key insights from the May report:
- Grain prices climb on weather and crop risk: Northern grain markets saw significant price lifts in April, with Brisbane and Newcastle wheat and barley leading the gains. The strength was driven by weather-driven risks in the US and low rainfall across southern Queensland and northern NSW, which keeps planting confidence in check.
- Brazilian beef exports caps local cattle prices: Increased volumes of lower-cost Brazilian beef exports into key international markets is directly limiting what export buyers are willing to pay for Australian cattle. With a dry forecast likely to increase local turn-off, this global competition is expected to maintain pressure on Australian cattle prices in the near term.
- Sheep and lamb prices hold strong despite dry outlook: Unlike the broader livestock trend, lamb and mutton prices remain firm. A smaller national flock compared to the highs of 2023 and significantly improved processing capacity are providing a floor under prices, which should limit the potential downside in the months ahead.
- Limited increases for dairy retail prices: While inflationary pressures rise for producers and processors, a combination of steady farmgate milk prices and cost-conscious shoppers are expected to limit significant increases in the retail price of dairy products for the time being.
Read the full Monthly Commodity Update – May 2026 report HERE.
