Weekly Market Reports


17th September, 2021

Friday, September 17, 2021

 WEEKLY MARKET REPORT

Week Ending 17th September, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S11/21

This Week

M11/21

Last Sale

S10/21

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2403

2461 2428 -25 1420n +983
18

2022

2088

2032

-10

1207

+815

19

1664

1665

1675

-11

1045

+619

20

1347

1337

1364

-17

949

+398
21 1269 1258 1279 -10 926n +343
 26 760 791 - - 591n +169

28

448

455

467

-19

441n

+7

MC

881

882

885

-4

638n

+243

MARKET MARKS TIME!!

The market followed its recent pattern of up and down movements this sale, but instead of weekly shifts of cheaper and dearer prices the movements were day to day. The AWEX EMI fell by just 9 cents to 1352 as the opening session’s fall of 16 cents was somewhat cancelled out by a 7 cent increase on the final day. The peaks and troughs in the market look to be edging higher as the 2 low points in August were 1330 with a peak of 1355. The market went to 1360 last week before dropping to 1345 on this sale’s opening day then rebounding to above 1350 on the final day.

The up and down pattern of price adjustments was across all sectors. For fleece types, most movements were restricted to losses of 10 to 15 cents bar the 17s that fell by 25 cents and 16.5 and 18.5s that finished in seller’s favour. The skirtings ended the sale 10 to 20 higher for low (< 5% VM) and 10 cents cheaper for high VM types. Cardings regained their opening day’s losses to end the sale just in buyers favour as the MCI fell by 4 cents to 881. The sad story continues for XBs with the initial falls unrecovered like the merino sector to record losses of 20 cents. Many burry types and short/carding wools were either “no bids” or had very little interest with this scenario in play for some time. The FRX fell slightly to 73.25 cents but was of no help to the market with the pass in rate edging up to 12.7%.

For some time now more and more emphasis has been placed on ‘Sustainability and Traceability” right along the wool pipeline from grower to retailer. Another major issue looming from Europe is with the EU Product Environmental Footprint. The PEF is a lifecycle assessment based method to quantify the environmental impacts of products or goods and services. It can be thought of as a ‘benchmark’ – a standard or point of reference against which any comparison can be made. In the context of PEF, the benchmark is the average environmental performance of the representative product sold in the EU market. More on this in upcoming reports.

Ram sales are ramping up with some outstanding results so far for both Merino and XB rams. Some sales from the past week include Yarrawonga at Harden which sold all 268 rams on offer to average $4,125 with a top price of $13,000. Wealla at Gilgandra achieved a top price of $5,500 with 100% cleared (100) to average $2,010 up by $350 from last year. Gullengamble at Yeoval cleared 92% of their 135 offered rams with a top price of $8,000 to average $2,600. At Trundle, Darriwell stud had a top price of $20,000 with just 3 rams from the 100 offered passed in to average $3,135.

Once again, European interests look to be dominating buying lists with their renewed competition for most of the better specified types and FNF lots. This is causing the Chinese and Indian buyers to adjust their premiums and discounts on most tested parameters to hit the minimum specifications needed at the ideal price points. The yo-yo effect on prices is a result of extra competition, increasing demand and ongoing price adjustments having to be made. Market should be firm to seller’s favour next week according to our sources.       



Southern Aurora Fwd Prices

Micron

Date

Low

21

Oct. 21

1280

Main Buyers (This Week)

1

Techwool Trading

4551

2

Endeavour Wool

2940

3

Modiano Australia

2647

4

PJ Morris Wools

2312

5

Tianyu Wool

2260

6

Australian Merino

1987


Eastern Market Indicators (AUD cents/kg clean)

1352 cents ê 9 cents compared with 10/09/2021

Northern Market Indicators (AUD cents/kg clean)

1441 cents ê 2 cents compared with 10/09/2021

   AUD/USD Currency Exchange

0.7329 ê 0.0054 compared with 10/09/2021

10th September, 2021

Friday, September 10, 2021

 WEEKLY MARKET REPORT

Week Ending 10th September, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S10/21

This Week

M10/21

Last Sale

S09/21

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2428

2479 2393 +35 1382 +1046
18

2032

2068

2005

+27

1172

+860

19

1675

1673

1633

+42

995

+680

20

1364

1349

1335

+29

910

+454
21 1279 1311 1233n +46 898n +381
 26 - 804 - - 526n -

28

467

470

475n

-8

396n

+71

MC

885

891

863n

+22

637n

+248

MARKET BREAKS THROUGH 1350!!

As we predicted last week, the market did claw back last series’ losses and some with all the rises coming in the opening session. The heat did come out of the market on the final day of selling in Sydney and Fremantle, but Melbourne bucked the cheapening trend to add a couple of cents to its indicator. By the close of trade the AWEX EMI rose by 29 cents to 1361 and a 31 cent gain in US$ terms saw the indicator climb over 100 cents to 1005. This was against a rising FRX that broke through the 74 cent barrier on Tuesday to settle at 73.85 today from a low of 73 last week. All merino fleece types rose to the tune of 25 to 45 cents. Skirtings took the lead from their fleece counterparts with rises of 30 to 50 cents on the opening day and sustained that gain with an unchanged market in the final session. Cardings, like the fleece wools, had positive then some negative movements to record 20 to 50 cent lifts, bar > 3% VM STN which gave back 10 to 20 cents. All 3 centres’ MCI’s are now averaging 896 cents. Crossbreds continue to lag behind merino types with 28 and broader losing 5 to 10 cents except 26s in Melbourne which added 30 cents. The national pass-in rate dropped to 9% from 20% last sale.

All the talk was positive from the last lot sold last week till Tuesday’s sale, as buyers booked up plenty of wool at good premiums above previous week’s levels, which translated into good increases in the sale room on Tuesday. Most were predicting 20 to 30 but the gains of up to 50 cents put a stop to fresh enquiry as most traders could not sell a bale later in the sale (Wednesday) thus the market stalling. Europe looks to have taken up some of the slack from China at the moment as the continent returns to work from Summer holidays and demand is good with most processors back to full capacity. Some buyers who did very little business with Europe are selling a lot more to them than in past years. Some prices paid for sub 16 micron fleece types were excellent with gains of 1200 to 2500 cents clean from last week for some 14 to 15 micron lots. Some lots from 14.4 to 13.1 micron made from 4700 to 7400 cents. This week marks one year since the market bottomed out at 858 cents. At today’s level of 1361, this is a 63% recovery in the EMI. How far can it go?? Some buyers and brokers are very confident that the market can go higher when the Asian demand picks up and competes with the European demand. This may happen sooner than later.

Ram sales have commenced with Haddon Rig holding their sale yesterday. Covid-19 didn’t seem to restrict the sale as nearly 200 poll rams sold from a top of $19,000 to average $3,236 and 130 horned rams averaged $2,760 with a top of $20,000 - a combined average of $3,045 for the 330 rams sold. AWI elections will be held in November and a vote on the woolgrower levy to be paid for the next 3 years, from July 2022, is to be held. Any grower that has paid $100 in levies over the past 3 years is eligible to vote. Voting can be done online from Monday, 13th September till Friday 5th November at www.woolpoll.com.au or 1800 211 736.


Southern Aurora Fwd Prices

Micron

Date

Low

21

Nov. 21

1280

Main Buyers (This Week)

1

Techwool Trading

4444

2

Endeavour Wool

3340

3

Fox & Lillie

2838

4

Tianyu Wool

2613

5

Australian Merino

1962

6

Modiano Australia

1810


Eastern Market Indicators (AUD cents/kg clean)

1361 cents é 29 cents compared with 03/09/2021

Northern Market Indicators (AUD cents/kg clean)

1443 cents é 26 cents compared with 03/09/2021

   AUD/USD Currency Exchange

0.7383 é 0.0071 compared with 03/09/2021

3rd September, 2021

Friday, September 03, 2021

 WEEKLY MARKET REPORT

Week Ending 3rd September, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S09/21

This Week

M09/21

Last Sale

S08/21

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2393

2425 2413 -20 1448n +945
18

2005

2013

2017

-12

1249

+756

19

1633

1628

1663

-30

1085

+548

20

1335

1321

1357

-22

991

+344
21 1233n 1254 1263n -30 976n +257
 26 - 771n 770n - 645n -

28

475n

481

475n

-

436n (M)

+39

MC

863n

887n

873n

-10

663n

+200

 MARKET GIVES BACK GAINS!!

The market’s fortunes went in reverse this week as last series’ gains were given back plus a bit as the AWEX EMI fell by 18 cents to 1332. The losses in US$ terms amounted to just 4 cents stopping at 974 as the FRX gained traction against the A$ to climb back through the 73 cent mark. The losses were very even across all microns with 15 to 30 cent falls from 16.5 to 22s. The superior superfine offering for the opening designated superfine sale of the season saw some healthy premiums paid - up to 175 to 200 cents clean for “Italian” types. Skirtings suffered similar falls to the fleece wools (15 to 30 cents). Heavy VM (> 5%) cardings and 17 to 18 micron LKS fell by 10 to 20 cents shaving 10 cents off the MCI to leave it at 863 cents. The crossbred sector was the least affected with 28 to 30 microns just in buyers’ favour and the broader and finer types 5 to 10 cents dearer.

Even though the market fell, signs of a recovery on Wednesday gives hope that the market may firm up next week. Sydney and Fremantle had a solid to dearer tone in this week’s final session and overnight enquiry should convert into sales if history is any guide. The market’s sluggish start to the season - a 91 cent fall (6%) is still a long way in front of the levels 12 months ago. August 2020 saw the EMI collapse by 205 cents from 1134 down to 929 with the low point of the market being in sale 10 (1 year ago next week) when the EMI fell to 858 cents. This equates to a 64% gain in the market to today’s level. The 17 micron indicator (Melbourne) is 1085 cents better - a massive 81% lift.

Top-makers and early stage processors continue to dominate buying lists with European interest’s keener than their Chinese counterparts. As feed dries out and sheep start picking up more VM late into the Spring and early Summer we’ll see if the current status quo remains when the higher VM wools come in and FNF fleece types dwindle. The cutoff point for VM discounts in fleece wools is about 2% at the moment, if and when this will change depends on when the heavier VM clips hit the market. Currently discounts for VM higher than 2% look to be way over the top.

Last week saw the National Ram sale held via the online platform AuctionsPlus. The annual event that is usually held in Dubbo was moved to Mudgee with the sheep show, stud displays and fleece judging cancelled due to Covid19. With interstate travel restrictions and lockdowns in place, some studs decided not to offer rams at the sale reducing the catalogue to only 32 rams. Overall, 21 rams were sold to a top of $15,000 with an average of $4,550. Nerstane from Walcha achieved the top price and the 3rd highest money ($7,750). In a New England trifecta, Alfoxton from Armidale sold the 2nd highest price ram for $10,500.

As we mentioned earlier, the market looks as though it will claw back this week’s losses and the EMI could break back through the 1350 cent mark.



Southern Aurora Fwd Prices

Micron

Date

Low

21

Nov. 21

1260

Main Buyers (This Week)

1

Techwool Trading

4657

2

Endeavour Wool

2979

3

Tianyu Wool

2606

4

Fox & Lillie

2171

5

PJ Morris Wool

1510

6

Australian Merino

822


Eastern Market Indicators (AUD cents/kg clean)

1332 cents ê 18 cents compared with 27/08/2021

Northern Market Indicators (AUD cents/kg clean)

1417 cents ê 16 cents compared with 27/08/2021

   AUD/USD Currency Exchange

0.7312 é 0.007 compared with 27/08/2021

20th August, 2021

Friday, August 20, 2021

 WEEKLY MARKET REPORT

Week Ending 20th August, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S07/21

This Week

M07/21

Last Sale

S06/21

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2394

2354n 2454
-60 1499 +895

18

2006

1967

2039

-33

1284

+722

19

1654

1655

1698

-44

1143

+511

20

1352

1358

1377

-25

1100

+252
21 1253n 1240 1303n -50 1086n +167
 26 - 765n 780n - 788n (M) -23 (M)

28

480n

478

500n

-20

523n

-43

MC

880n

910n

903n

-23

651n

+229

A COVID-19 CRASH? NOT LIKELY!!

After last week’s big fall and high withdrawal figures for this series, hopes were high that the reduced volume would be a catalyst to steady the market. This sale was at one point rostered for 46,000 bales, then fell to 38,000 on Monday. By weeks’ end only 34,400 bales were offered with 28% passed-in and 15% withdrawn meaning only 24,600 bales actually sold to the trade. Fremantle held its sale over just 1 day as only 4000 bales were on offer - 58% passed-in and 7% were withdrawn to have only 1,700 bales sold. This being the lowest weekly “sold” figure of any selling centre since AWEX records began in 1997. Tuesday’s market opened on a much cheaper note to follow on from last sales' poor performance but signaled some hope as it showed some resilience to level out on Wednesday. Again, 25 to 60 cent losses were across the board for all merino fleece microns. Skirtings fared just as badly as their fleece counterparts with losses ranging from 40 to 70 cents. Cardings also suffered heavy losses with all types in this sector giving back another 20 to 50 cents bar < 18.5 micron LKS which finished just in buyers’ favour.  For the 2nd sale in a row the crossbred sector looked to be the least affected with falls confined to 10 to 20 cents. The EMI fell by another 37 cents to 1335 - that’s 93 cents for the 2 sales since selling resumed. In US$ terms the 41 cent fall saw the indicator drop below 1000 cents to 970 as the 1 cent fall to 72.60 in the FRX wasn’t enough to stop the market falling. The A$ is well below 72 cents today - a 9 month low.

The enticement of cheaper prices at the end of last week failed to draw any new business from any of the major mills in China which resulted in the ongoing price reduction on the opening day. The ongoing container terminal closure in China and the latest Covid-19 reduced demand hiccup conspired to keep confidence low in the initial session with some smatterings of business stabilising the market on Wednesday. Italian interests were highlighted this week as one of their major companies purchased heavily. After just 4 sales this season this buyer has bought 39% of what they secured at auction all last season. He purchased a big volume of superior superfine wools in the Carmichael section of our catalogue from Mudgee and the New England at good premiums (up to 180 cents clean) above market rates. We also had a big run of excellent XBs in the Carmichael section which sold well. The good premiums (5-10%) that RWS certified wools are getting is also worth noting.

The Australian wool production forecasting committee has predicted shorn wool production is expected to rise by 5.2% (up to 310mkg) when compared to last season. This is up by 26mkg from just 2 years ago due to excellent seasonal conditions coming out of the drought and good lambings over the past 2 seasons.

In more Covid-19 news, as we know all businesses must have QR codes - this is a requirement for shearing sheds as well. Some sheds in southern NSW were inspected with fines and infringement notices issued for non-compliance. Growers are reminded to ensure that QR codes are available for use or a sign-in register is to be provided for all farm workers.

Market should be firm next week.

Southern Aurora Fwd Prices

Micron

Date

Low

21

Nov. 21

1240

Main Buyers (This Week)

1

Techwool Trading

2851

2

Fox & Lillie

2420

3

Tianyu Wool

2307

4

Endeavour Wool

1925

5

Australian Merino

1484

6

PJ Morris Wool

948


Eastern Market Indicators (AUD cents/kg clean)

1335 cents ê 37 cents compared with 13/08/2021

Northern Market Indicators (AUD cents/kg clean)

1428 cents ê 35 cents compared with 13/08/2021

   AUD/USD Currency Exchange

0.7264 ê 0.01 compared with 13/08/2021

13th August, 2021

Friday, August 13, 2021

 WEEKLY MARKET REPORT

Week Ending 13th August, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S06/21

This Week

M06/21

Last Sale

S02/21

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2454

2378 2538
-84 1478 +976

18

2039

2020

2129

-90

1272

+767

19

1698

1704

1768

-70

1126

+572

20

1377

1403

1438

-61

1083

+294
21 1303n 1293 1342 -39 1081n +222
 26 780n 773n - - 765n +15

28

500n

489n

530n

-30

520n

-20

MC

903n

938n

948n

-45

716n

+187

OUCH!! A PAINFUL START TO SALES.

It was a bad resumption to wool sales after the 3 week winter recess. Most participants were hopeful of a solid market even with forecasts predicting 57,000 bales 2 weeks ago. Last Friday, this fell to 53,000 bales and with the FRX in our favour by over 1.5 cents the market was looking to be just in buyers’ favour when auctions commenced. Up until one of China’s main buyers suddenly withdrew from the market only minutes before selling started. This resulted in the market almost “free-falling” on Tuesday with losses ranging from 130 cents for 16.5s in Melbourne to 40 cents for 21s. The market looked to steady a bit on Wednesday with a few finer microns losing 10 to 20 cents and all others 5 to 10. Hopes were up for a leveling market in Fremantle which concluded up to 20 cents dearer. Melbourne finished the sale in isolation on Thursday with < 17.5 losing more ground and coarser microns slightly up. The AWEX EMI lost 56 cents to 1372 and fell to 1010 in US$ terms (a 55 cent loss). By the numbers, finer than 19 micron fell by 70 to 90 cents with broader wools 40 to 60 cheaper. Again, it was the finer microns that took the brunt of the losses in the skirtings as < 18 micron lost 70 to 100 cents with > 19 reduced by 30 to 50 cents. Cardings lost anywhere from 30 to 100 cents depending on type as the 3 MCIs lost an average of 45 cents - all still sit above 900 cents (903 to 938). The crossbred sector was the least affected as opening session falls of 20 to 30 cents was the only movement for the sale. The pass-in rate skyrocketed to 33%.

So why the big fall?? The absence of one of China’s largest processors for the whole sale and the quieter buying patterns of 2 other major buyers was a main reason, while the annual discussion over big quantities after a recess still rages. One solution to avoid a large catalogue after a recess is to shorten the break to 2 weeks but getting buyers/brokers to agree on this is akin to saying Covid-19 is not spreading!! Chinese demand was poor at best but India, Italy and the Czech Republic seemed to maintain their pre recess buying patterns albeit at lower prices. Covid worries (Delta strain spreading rapidly) could have a dampening effect on demand from China in the short term. The ability to move greasy wool further down the processing pipeline has suddenly (over the recess) become a big hurdle to jump as some exporters are still experiencing financial constraints despite many “letters of credit” being opened during the break. The shipping and supply chain delays that have been a major problem and still pose some difficulties could be exasperated as a dock worker has tested positive to Covid-19 causing the closure of a major container terminal. The (1.35 billion US$) state-of-the-art Ningbo container terminal is located 100km south of Shanghai and was the 3rd busiest container port in the world last year.

Quantities have reduced sharply to 41,000 bales next week but may not be enough to halt the markets slide. We are hope they’re wrong!!


Southern Aurora Fwd Prices

Micron

Date

Low

21

Nov. 21

1310

Main Buyers (This Week)

1

Techwool Trading

5527

2

Endeavour Wool

2603

3

Australian Merino

2466

4

Fox & Lillie

2298

5

Modiano Aust.

2213

6

PJ Morris Wool

1919


Eastern Market Indicators (AUD cents/kg clean)

1372 cents ê 56 cents compared with 14/07/2021

Northern Market Indicators (AUD cents/kg clean)

1463 cents ê 59 cents compared with 14/07/2021

   AUD/USD Currency Exchange

0.7463 ê 0.0099 compared with 14/07/2021

16 July, 2021

Friday, July 16, 2021

WEEKLY MARKET REPORT

Week Ending 16th July, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S02/21

This Week

M02/21

Last Sale

S01/21

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2538

2503n 2536
+2 1638 +900

18

2129

2130

2115

+14

1428

+701

19

1768

1770

1748

+20

1279

+489

20

1438

1446

1427

+11

1229

+209
21 1342 1324 1312 +30 1228n +114
 26 - 811n - - - -

28

530n

514

470n

+60

574n

-44

MC

948n

968n

959n

-11

801n

+147

A GOOD SOLID FINISH TO WOOL SALES!!

The market managed to keep its head above water defying a potential drop in values due to excessive quantities. A dearer opening session led to the final day’s drifting market, wrapping up sales before the annual 3 week Winter recess. The 1st 2 sales of the season have seen a plethora of wool being offered with 100,200 bales compared to just 66,000 in last year’s 2 corresponding sales - an increase of 51%. The market has managed to absorb this extra volume as the net result for the 2 July sales has seen a 5 cent rise for the AWEX EMI. The FRX’s favourable adjustment and no wool sales worldwide for the next 3 weeks saw buyers trying to fill outstanding orders and get as much wool as possible on the water. The EMI rose 8 cents to 1428 as finer microns (< 17) were firm in Sydney but fell by 45 to 85 cents in Melbourne, while all others ranged from 10 to 30 cents better. Skirtings had a good series with the low VM types < 2.5% gaining 20 to 25 cents with burrier lots just in buyers’ favour. Cardings were the only sector to lose ground as types above 3% VM gave up 20 to 40 cents while all others were fully firm for the sale. The MCI lost 11 cents and is now sitting at 948. Crossbreds regained last sale’s losses as most microns added 25 to 60 cents to last week’s prices. The FRX stayed at 74.6 cents all week with the pass-in rate at 13%. In US$ terms the market rose by 6 cents to 1066.  

China topped all sector’s buying lists with good and increasing support from the other major wool destinations - Italy, India and Czech Republic. Local traders were keen to secure volume with Chinese indent and top-makers active. Europe’s largest top-maker flexed their muscle to push XBs higher purchasing 32% of the offering.

European yarn and fabric fairs have recently been held with Italian processors given a chance to collaborate with customers and work on buying strategies for the next 6 to 12 months. As the table above illustrates, 19 micron and finer have staged a remarkable recovery over the past 12 months. The trade is very comfortable with these types of wools that command premiums lingering at the present price levels, having been missing for 18 months. One big theme that arose from the Pitti Filati Yarn and Idea Beilla Yarn fairs was “sustainability” - something that will become more and more critical into the future. Another buzzword is “Blockchain” which will be intensely discussed at future conferences and exhibitions for the fashion industry. This facilitates the transfer of data rather than maintaining a central repository ensuring no one can modify or manipulate anything along the wool production pipeline to suit their own requirements. Blockchain systems will make processors more efficient and transparent while highlighting ethical and sustainable practices. Sales recommence on Tuesday, 10th August.


Southern Aurora Fwd Prices

Micron

Date

Low

21

Oct. 21

1320

Main Buyers (This Week)

1

Techwool

6548

2

Fox & Lillie

4425

3

Tianyu Wool

3995

4

PJ Morris

3516

5

Endeavour Wool

3437

6

Modiano Aust.

2457


Eastern Market Indicators (AUD cents/kg clean)

1428 cents é 8 cents compared with 09/07/2021

Northern Market Indicators (AUD cents/kg clean)

1522 cents é 12 cents compared with 09/07/2021

   AUD/USD Currency Exchange

0.7463 è 0.0000 compared with 09/07/2021


9 July 2021

Friday, July 09, 2021

 WEEKLY MARKET REPORT

Week Ending 9th July, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S01/21

This Week

M01/21

Last Sale

S53/20

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2536

2546n 2545
-9 1586 +950

18

2115

2131

2143

-28

1408

+707

19

1748

1761

1738

+10

1284

+464

20

1427

1440

1438

-11

1221

+206
21 1312 1325 1302n +10 1200n +112
 26 - - - - 810n -

28

470n

473

490n

-20

564 (M)

-91 (M)

MC

959n

957n

965n

-6

826n

+133

NOT AS BAD AS EXPECTED!!

Even though the market opened the new season on a cheaper note (that was widely anticipated by buyers) the AWEX EMI did manage to stay above the 1400 cent mark. Results in the 3 centres were markedly different as Sydney fell by 12 cents and Melbourne and Fremantle recorded 2 cent gains. The softer start to the series was turned around by the end of selling in Melbourne on Thursday (in isolation) with all Merino MPGs averaging 20 cents better in Melbourne than Sydney by the close of the market which augers well for next week. In the final washup the EMI lost just 3 cents to 1420 with 17s and finer, 18.5 and 19.5/20s falling by 5/10 cents. A fall of 25 cents was the result for 17.5/18 micron while 19 and 21s added 10 cents. After initial losses in the opening session skirtings recovered to finish the sale in buyers’ favour bar some high VM types with poor AM readings to be 20 to 30 cents off the pace. Cardings followed a similar pattern to their combing counterparts to end the series in buyers’ favour with the XB selection 15 to 30 cents cheaper across the board.

The sharp rise in the FRX on Monday night (to 76.5 cents) sent the market south in the opening session on the East Coast but, by the time Fremantle finished selling, a change in sentiment had come to see consolidation on Wednesday and a dearer market to end the week. The big initial offering of 56,000 then 53,000 bales didn’t frighten buyers away as first thought with an expected fall of 20 to 50 cents for most fleece types never eventuating. Many fabric and garment makers had been questioning the rises over the past 6/8 weeks when there were no signs of increased consumption in the Northern Hemisphere and nervous about whether consumers would take up the slack in their up-and-coming autumn. It looks as though early stage processors got a little over excited and pushed prices beyond the comfort level of their downstream users when retail demand had not increased. This time of year can often see large volumes of wool hitting the market (start/end of financial year) with some brokers absolute disregard for orderly marketing, this week’s sale being the biggest so far this year and next week identical (51,300 bales) adding up to 64% more wool offered than the 2 corresponding sales last year at 66,100 bales. Buyers will be mindful of the up and coming 3 week recess here and the 6 week recess in South Africa (currently under way) and no sales in New Zealand, there will be no access to wool sales anywhere in the world till early August. Hopefully this recess will give them a chance to deliver wool to mills and open letters of credit to allow funding for when sales start again. Showfloor chatter is for a solid to dearer market.

Southern Aurora Fwd Prices

Micron

Date

Low

21

Oct. 21

1320

Main Buyers (This Week)

1

Techwool

7608

2

Tianyu Wool

4656

3

Endeavour Wool

4070

4

Fox & Lillie

3920

5

PJ Morris

3745

6

Aust. Merino

2466

Eastern Market Indicators (AUD cents/kg clean)

1420 cents ê 3 cents compared with 02/07/2021

Northern Market Indicators (AUD cents/kg clean)

1510 cents ê 12 cents compared with 02/07/2021

   AUD/USD Currency Exchange

0.7463 ê 0.0059 compared with 02/07/2021

2 July 2021

Friday, July 02, 2021

 WEEKLY MARKET REPORT

Week Ending 2nd July, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S53/20

This Week

M53/20

Last Sale

S52/20

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2545

2578 2623
-78 1586 +959

18

2143

2163

2203

-60

1408

+735

19

1738

1758

1820

-82

1284

+454

20

1438

1423

1510

-72

1221

+217
21 1302n 1289 1380n -78 1200n +102
 26 - 795 798 (M) -3 (M) 816 (M) -21 (M)

28

490n

500

509n

-19

564 (M)

-64 (M)

MC

965n

955n

978n

-13

801n

+164

A RECOVERY SEASON ENDS ON A SOFT NOTE!!

As we forecast in last week’s report, the market may have reached its “Everest” for the moment. The slightly cheaper tone in the final session was a precursor for this series. The ongoing shipping delays that are tying up vital finances and predicted Sale 01 volumes of 55,000 bales (the largest sale since March, 2020, after the wool industry software provider was hacked forcing a cancelled sale) was enough to firmly put the brakes on the rising market for the time being. The AWEX EMI gave back 45 cents (3.07%) to 1423. The losses were similar in US$ terms, 38 cents (3.41%) to 1070 as the FRX finished fractionally lower at 75.2 cents. No sector of the market was immune from the cheaper trend as Merino fleece types fell 55 to 85 cents. Skirtings gave back 25 to 40 cents with the low VM (< 2.5%) with good specs less affected. The 3 centres’ carding markets had 3 different results: Sydney lost 13 cents, Melbourne was in sellers’ favour and Fremantle adding 30 cents to see all 3 MCIs averaging 965 cents. Crossbreds also lost ground by 10 to 20 cents for most types. The pass-in rate climbed to 21% but for the season was 5.4% lower than the previous season at 11%

It was a disappointing way to finish the season but a look at the numbers over the past year paint a picture of recovery that no-one would’ve predicted from what was a dire situation due to the pandemic. The market is 27.5% higher than 12 months ago - 1423 to 1116 with the low point of 858 in early September - the EMI now 60% higher than the low point. The market is 300 cents (38%) better in US$ terms and the FRX stronger by 6 cents. As the table above illustrates, all but XBs are higher than last year, especially < 19 micron with superfine wools at 2 year highs. There were 311,000 bales extra offered this season (1,782million) up by 21% with the $ amount at $2,246.72 million, up by $274million. The top price for the year was 4,900 cents for a 12.8 micron fleece bale sold in May. China completely dominated the market to purchase over 80% of the clip as India and Europe continue to build up their processing capacity but are not operating anywhere near full capacity yet. With vaccinations well on track in the northern hemisphere it is hoped by the end of 2021/early 2022 lockdowns and restrictions will be a thing of the past with all facets of life back close to normal and consumers spending money on woolen apparel to further enhance the farmgate price for wool. Next week is the opening sale of the new season with 55,000 bales rostered and exporters struggling to find enough enquiry and finance to buy at the current level. An EMI that can stay above 1400 will be a good result by this time next week.

Southern Aurora Fwd Prices

Micron

Date

Low

21

Oct. 21

1300

Main Buyers (This Week)

1

Techwool

4612

2

Fox & Lillie

3488

3

PJ Morris

2361

4

Endeavour Wool

2252

5

Tianyu Wool

2243

6

United Wool

2097

Eastern Market Indicators (AUD cents/kg clean)

1423 cents ê 45 cents compared with 25/06/2021

Northern Market Indicators (AUD cents/kg clean)

1522 cents ê 42 cents compared with 25/06/2021

   AUD/USD Currency Exchange

0.7522 ê 0.0024 compared with 25/06/2021

25 June 2021

Friday, June 25, 2021

 WEEKLY MARKET REPORT

Week Ending 25th June, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S52/20

This Week

M52/20

Last Sale

S51/20

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2623

2606n 2568
+55 1592 +1031

18

2203

2198

2169

+34

1401

+802

19

1820

1819

1810

+10

1276

`+544

20

1510

1488

1500

+10

1212

+183
21 1380n 1379 1356n +24 1197n +183
 26 - 798n 765 (M) +33 (M) 795n (M) +3 (M)

28

509n

521

493n

+16

551 (M)

-30 (M)

MC

978n

951n

976n

+2

814n

+164

HAS THE MARKET PEAKED??

The wool market had another positive series to see the AWEX EMI post a 20 cent gain to 1468. This most likely could be the peak as the market did in fact lose 4 cents in the final session from its high point of 1472 cents on the opening day. Showfloor talk amongst the buyers that the top of the market was close was spot on as another frantic start to sales was tempered by the close and the second day saw losses of 5/10 cents for 18.5 to 20 micron whereas 17 and finer still added to their values. By week’s end 18.5 to 22 micron rose by 10 to 25 cents with finer types 35 to 70 cents better with some lots over 100 cents higher. Once again the clearance rate for fleece types was high at 98.4% with just 124 bales not sold. Skirtings enjoyed another good sale as increases of 20 to 40 cents was common for all types in this sector with no hint of a softer tone on the final day. After 5 weeks of rises (totaling 95 cents) the carding sector was just in sellers’ favour to add 2 cents to 978 as the opening day’s gains were barely maintained in the final session. Crossbreds kept pace with their merino counterparts with all microns adding 10 to 30 cents. As mentioned earlier, the EMI gained 20 cents to 1468 and in US$ terms just a 4 cent rise to 1108 due to the FRX rising on Tuesday night but week to week was 0.75% lower with the A$ low point at 74.85 over the weekend with some exporters saying if the FRX didn’t fall the EMI could’ve fallen by 10/20 cents.

With just the 2 East Coast centres operating, this presented the smallest national catalogue since October (33,300). This small volume coupled with the FRX rates favouring exporters was an opportunity for the market to keep forging ahead as it had done for the past 7 sale days (adding 130 cents) but buyers were indicating the market had run out of steam. Shipping issues continue to delay wool on the water and at port thus tying up critical finance to keep buyers purchasing wool. Finances have been stretched for some time with unusually large offerings for winter, financial strain is something buyers have become accustomed to lately. With 3 sales before the winter recess, buyers and their bank accounts are looking forward to the break to replenish themselves and hopefully top up their money pits!

Buying honours were evenly spread amongst topmakers, manufacturers and local traders with the softer FRX helping overseas users in dealing with a similar price in their local currency. Next week sees the final sale of the season with all 3 centres in action with a catalogue of 44,400 bales on offer. Buyers are predicting some sort of price correction to continue on from the final day this week but, to what extent is still unknown. FRX movements will be critical in determining how the market will fare.

Southern Aurora Fwd Prices

Micron

Date

Low

21

Oct. 21

1300

Main Buyers (This Week)

1

Techwool

5033

2

Fox & Lillie

3732

3

Endeavour Wool

2701

4

Tianyu Wool

2313

5

Modiano

2009

6

Lempriere

1860

Eastern Market Indicators (AUD cents/kg clean)

1468 cents é 20 cents compared with 18/06/2021

Northern Market Indicators (AUD cents/kg clean)

1564 cents é 21 cents compared with 18/06/2021

   AUD/USD Currency Exchange

0.7546 ê 0.0074 compared with 18/06/2021

18 June 2021

Friday, June 18, 2021

 WEEKLY MARKET REPORT

Week Ending 18th June, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S51/20

This Week

M51/20

Last Sale

S50/20

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2568

2589n 2488
+80 1613 +955

18

2169

2184

2074

+95

1438

+731

19

1810

1799

1734

+76

1314

+496

20

1500

1489

1423

+77

1243n

+257
21 1356n 1374 1311 +45 1229n +127
 26 - 765 740 (M) +25 (M) 815n (M) -50 (M)

28

493n

498

483n

+10

589 (M)

-91 (M)

MC

976n

946n

954n

+22

858n

+118

1400 DONE AND DUSTED!!!

For the second series running the AWEX EMI added 50+ cents to its value. This has the market on a 5 week ascendency that has seen it climb by 142 cents, 74% (105 cents) of that over the past 2 sales to smash through the 1400 cent mark. It has been a rapid rise from when the market was seemingly stuck between 1300 and 1350 for 7 weeks in April/May. The EMI now sits at 1448 up by 55 cents. In US$ terms the market rose by 25 cents to 1103 as the FRX dropped sharply on Wednesday night to 76.2 cents, back by 1.2%. Increases were across the full spectrum of MPGs: 20 micron and finer recorded rises of 70 to 95 cents with 21s and coarser up to 45 cents dearer as just 89 bales (1.2%) of fleece were passed-in in Sydney. Skirtings saw good gains but not to the extent of their fleece counterparts - all types and descriptions 30/50 cents to the good. The call for more knitwear which continues to dominate the fashion scene saw cardings ascend about the same level as last series with the 3 centres averaging a 26 cent rise as all types in this sector looked to be 20 to 50 cents higher - the MCIs across the 3 centres now at 956 cents. Crossbreds saw some good gains as 26s and 32 micron lifted by 25 cents with 28/30s in sellers’ favour.  Surprisingly the pass-in rate was a fraction higher at 4.6%.

The extra volume of 6,200 bales to 42,500 as Fremantle joined in didn’t dampen exporters appetite for more wool. Some buyers would be happy to take the ‘sit and wait’ approach while others are keen to secure wool for the longer term (late into the year) albeit at just below prompt market prices. There are always buyers that are cautious about pushing the market to “unsustainable levels” but, in the current environment, that looks unlikely as the processing season is historically in full swing. Chinese garment makers are missing the usual lead from European fashion designers and unsure about what colours and styles to proceed with for the up and coming season. Their processing capacity is sitting at about 70% due to a shortage of textile workers leading to the ongoing production and shipping delays that are frustrating retailers and consumers globally. Processors in Europe are busy when compared to last year but, like China, nowhere near full production capacity as their first enquiry is about delivery time then price. Spinners and knitters on the continent are busy with more and more weavers dusting off their idle looms at long last. The northern hemisphere selling season for woolen garments will start in September with consumer confidence and addressing sustainability concerns at the forefront of purchase patterns of consumers when buying discretionary items such as woolen apparel. Fremantle sit out next week’s sale with just 34,600 bales on offer on the East Coast with no talk of the market having a correction yet.

Southern Aurora Fwd Prices

Micron

Date

Low

21

Sept. 21

1270

Main Buyers (This Week)

1

Techwool

6451

2

Tianyu Wool

4071

3

Endeavour Wool

4017

4

Fox & Lillie

3854

5

PJ Morris Wool

2381

6

United Wool

2183

Eastern Market Indicators (AUD cents/kg clean)

1448 cents é 55 cents compared with 11/06/2021

Northern Market Indicators (AUD cents/kg clean)

1543 cents é 56 cents compared with 11/06/2021

   AUD/USD Currency Exchange

0.7620 ê 0.0119 compared with 11/06/2021