Indian companies are expected to bid for an ultra fine bale of wool when it goes under the hammer in this Australian city next week, a media report said Tuesday.

Considered the world's finest ever bale of wool, the 100 kg ultra fine merino wool bale was produced in Victoria.

It was expected to be sold to India or Italy before being processed into high-quality fabric, Ted Wilson of Landmark-Jackson Geelong said.

The premium wool fibre is 11.4 microns, which makes it barely visible to the naked eye.

The last world record merino bale measured 11.6 microns and sold to India for $259,000 in June 2008, Australian news agency AAP quoted Wilson as saying.

'Korea in the past have bought bales that have been very fine but I would expect the major competition to come from Italy and India.

'Being such a specialised, unique fibre, there are very few companies in the world that can process wool this fine,' Wilson told AAP.