Weekly Market Reports


13 September 2019

Friday, September 13, 2019

WEEKLY MARKET REPORT 

Week Ending 13th September, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S11/19

This Week

M11/19

Last Sale

S10/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1930

1969

1842

+88

3008

-1078

18

1853

1874

1783

+70

2708

-855

19

1755

1833

1578

+177

2439

-684

20

1682

1785

1497

+185

2303

-621

21 1645n 1769 1487n +158 2274 -629
26 1165n - 1100n +65 1493n -328

28

953n

961

853n

+100

975

-22

30

813n

818n

703 (M)

+115 (M)

738n

+75

MC

906n

1007n

814n

+92

1563

-657

HISTORIC RISES BUT WHERE TO FROM HERE??

What an incredible week for the market as the recovery was nothing short of spectacular. After last sale’s stable market and signs of a level being found last Thursday, futures trading was pointing to a 30/40 cent lift and by Tuesday night predictions were in the 80 to 100 cent range. Both were wrong! The sale in Sydney was condensed to a one day sale due to lack of quantity with gains of 70 to 90 cents for < 18 micron and the broader types 130 to 185 higher. The AWEX EMI added 170 cents to 1535 - the largest weekly gain on record - with the 130 climb on Wednesday the biggest daily rise of all time. Skirtings added 80 to 100, XBs rose 65 to 100 and cardings put on 50 to 100 cents. Despite this steep rise for all sectors, the pass-in rate was 6.2%

After loosing 389 cents (24.5%) since the resumption of sales over the past 5 weeks the market made a stunning comeback to gain 170 cents (12.2%) in one week to wipe out 44% of the losses.  Buyers were frantic to secure quantity as discounts shrank and premiums for better types rose to extreme levels. As one buyer said, “Exporters stopped selling the market down” as the volume of wool on offer compared to the wool actually sold over the past 5 sales had declined by 40/50% due to the high passed-in rates and withdrawn lots. Another factor was the sudden rush of woolen clothing imported to the US from China before last week’s additional 15% import duty came into effect as US retailers tried to beat the 1st September deadline. For June and July the year-on-year % of wool imports rose by 30%. This major increase in exported clothing may have left some manufacturers short on stock in China and with small offerings to pick from, panic looks to have set in. Also adding to the good news was the softening stance between the US and China over tariffs and agreeing to a resolution may not be just a dream but reality sooner rather than later which can only help consumer confidence north of the equator.

Kerin Poll held their ram sale this week with a total clearance of 450 rams to average $2500 topping out at $10,000. At the feature sale in Adelaide 2 rams were bought by syndicates for $100,000 (poll) and $72,500 (horn). These results augur well for the stud selling season despite the on-going drought and less ewes to join and maybe not as many rams needed for upcoming joinings. After the overdone falls in August and this sale’s correction anything is possible in this current volatile market. Who knows what for next week??

Ag Concepts Fwd Prices as at 13 September, 2019       

Micron

Date

Low

High

21

27-Nov-19

1520

1535

21

22-Jan-20

1600

1600

Free knitted woollen jumpers for poddy lambs. Call into our office in Dubbo or Macdonald Rural at Brewarrina and take as many as you need. Many colours and styles to choose from!

Main Buyers (This Week)

1

Fox & Lilliel

3267

2

Techwool

1997

3

Modiano

1334

4

Endeavour Wool

1303

5

PJ Morris

1298

6

Aust. Merino

972

Eastern Market Indicators (AUD cents/kg clean)

1535 cents é 170 cents compared with 06/09/2019

Northern Market Indicators (AUD cents/kg clean)

1534 cents é 126 cents compared with 06/09/2019

   AUD/USD Currency Exchange

0.6878 é 0.0059 compared with 06/09/2019

6 September 2019

Friday, September 06, 2019

WEEKLY MARKET REPORT 

Week Ending 6th September, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S10/19

This Week

M10/19

Last Sale

S09/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1842

1823

1845

-3

2989

-1147

18

1783

1747

1795

-12

2669

-886

19

1578

1582

1593

-15

2443

-865

20

1497

1481

1515

-18

2324

-837

21 1487n 1477 1499n -12 2285 -798
26 1100n - - - 1486n -386

28

853n

849

843n

+10

968

-115

30

-

703

698n (M)

+5 (M)

739 (M)

-36 (M)

MC

814n

821n

806n

+8

1563

-749

IS THIS THE BOTTOM??

This week’s market started off poorly but rebounded in the final session to give a glimmer of hope that the market may have finally bottomed out. By week’s end the AWEX EMI lost just 10 cents to 1365 with a slight lift in US$ terms (6 cents) to 931. All MPGs fell ranging from 5 to 20 cents with the very odd best style Italian lot fetching 30 to 60 cents higher than their indicators. The renewed buyer interest flowed through to Room 2 as skirtings lifted by 30/50 cents, cardings added 30 to 60 cents and XBs looked up to 10 cents dearer.

Finally the market came off the descending elevator to find the stairs. After a horror August which saw the market shed 379 cents (23.8%), the largest monthly % decline in 28 years, the market recorded its first daily rise since Sale 2 on Thursday to hopefully stop the rot. The EMI is a massive 723 cents (34.6%) lower than a year ago, meaning just 10% was lost in the period from August 2018 till end of July. The “super-cycle” that most analysts talk about is certainly over. This is the 5th such cycle since the market’s big jump in 1988. Reasons for the downturns in the market after theses super-cycles are varied and all not related to the wool market, rather global external factors. If we look at the 4 downturns this century: 2003 to 2005 with the SARS outbreak in China the EMI fell 608 cents (49%) to a low of 632; the GFC period of 2008/09 saw a 328 cent drop to 721 (31%); from 2011 to 2012 a 35% (501 cents) fall to 933 was due to the massive cotton stockpile that China had built up after the GFC; and, of course, this current downturn which hopefully is nearing its end.

Now we are faced with new global challenges that will take time (up to 2 years according to some economic experts) to sort out from Brexit to the US/China trade wars which took a new twist this week. As of Monday the US lifted tariffs by 10% on a vast range of imports from China (worth $300B) from 20% to 30% but for woolen clothing the tariff was raised by 15%. Have prices “overshot” their high and low points?? Many believe so and the fundamentals of supply and demand get lost in the over-correction when the market goes in either direction. Many traders believe the market reached an unsustainable height last year and this current correction has gone too far. Hopefully the market can maintain the level it finished at on Thursday.

Ag Concepts Fwd Prices as at 30 August, 2019       

Micron

Date

Low

High

21

16-Oct-19

1500

1500

21

20-Nov-19

1500

1500

Free knitted woollen jumpers for poddy lambs. Call into our office in Dubbo or Macdonald Rural at Brewarrina and take as many as you need. Many colours and styles to choose from!

Main Buyers (This Week)

1

Techwool

2778

2

Fox & Lillie

2152

3

Endeavour Wool

2118

4

Tianyu Wool

1778

5

G Schneider

1077

6

PJ Morris

1044

Eastern Market Indicators (AUD cents/kg clean)

1365 cents ê 10 cents compared with 30/08/2019

Northern Market Indicators (AUD cents/kg clean)

1408 cents é 3 cents compared with 30/08/2019

   AUD/USD Currency Exchange

0.6819 é 0.0090 compared with 30/08/2019

30 August 2019

Friday, August 30, 2019

 WEEKLY MARKET REPORT 

Week Ending 30th August, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S09/19

This Week

M09/19

Last Sale

S08/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1845

1819

1952

-107

2968

-1123

18

1795

1754

1888

-93

2651

-856

19

1593

1611

1728

-135

2418

-825

20

1515

1504

1683

-168

2311

-796

21 1499n 1503 1667n -168 2286 -787
26 - 1133n 1148 (M) -15 (M) 1548n (M) -415 (M)

28

843n

846

870n

-27

965

-122

30

703n

698n

710n

-7

731n

-28

MC

806n

795n

895n

-89

1560

-754

ANOTHER DISASTROUS WEEK!

Just when there was a glimmer of hope the market might steady, woolgrowers were hit between the eyes with a sledgehammer for the second time in 3 sales!! The market took another savage hit with all microns recording triple figure losses, < 18.5 back by 90 to 110 cents while 19s and broader collapsed by 135 to 170 cents with only the very best types immune from the almost complete lack of support. Skirtings fared worse as better style, low VM types fell 70 to 100 cents while burrier (> 4%) lots with col and dust were quoted 180 to 250 cents from last sale’s levels. Cardings were also savaged by a lack of demand - all types in this sector reduced by 80 to 140 cents. The MCI has now lost an average of 93 cents for the past 2 sales and now sits at 806 a percentage ranking of just 6, meaning it has been higher 94% of the time over the past 5 years. Crossbreds came through the sale virtually unscathed - losses ranging from to 25 cents. The pass-in rate climbed to 35% with 18% withdrawn which saw 47% of the original volume rostered for sale actually sold.

On a brighter note, our seminar on Sheep Welfare and Husbandry Best Practice was attended by 90 woolgrowers keen to hear the guest speakers from wool buyers to vets and reps from current products and gain insight into some newly released products that can assist growers in the absolute best practice welfare for their sheep. It was a very informative day with the message coming through loud and clear that from the consumer who buys woolen garments to vets, whether your sheep are mulesed or non-mulesed, the best welfare practice is critical.

The National Merino Sheep Show and Ram Sale was held in Dubbo this week as the drought tightens its grip and the wool market continued its dramatic fall. Talk of a tough sale was spot on as the clearance rate fell to 53%. Roseville Park topped the sale with a ram selling for $22,000 and a $7,000 average; Langdene averaged $3166; and Alfoxton from Armidale who won the Supreme Champion Ram sold another for $16,000.

A few buyers have reported good volumes of business overnight that hopefully might stop the rot next week.


Ag Concepts Fwd Prices as at 30 August, 2019

Micron

Date

Low

High

21

25-Sep-19

1620

1620

21

13-Nov-19

1600

1600


21

22-Jan-20
 
1570

1570 

Free knitted woollen jumpers for poddy lambs. Call into our office in Dubbo or Macdonald Rural at Brewarrina and take as many as you need. Many colours and styles to choose from!

Main Buyers (This Week)

1

Techwool

2343

2

Tianyu Wool

2141

3

Fox & Lillie

1747

4

G Schneider

1166

5

Endeavour Wool

1622

6

PJ Morris

665


Eastern Market Indicators (AUD cents/kg clean)

1375 cents ê 122 cents compared with 23/08/2019


Northern Market Indicators (AUD cents/kg clean)

1405 cents ê 116 cent compared with 23/08/2019

   

AUD/USD Currency Exchange

0.6729 ê 0.0054 compared with 23/08/2019

23 August 2019

Friday, August 23, 2019

 WEEKLY MARKET REPORT 

Week Ending 23rd August, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S08/19

This Week

M08/19

Last Sale

S07/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1952

1923

2000

-48

2917

-965

18

1888

1860

1932

-44

2617

-729

19

1728

1734

1766

-38

2393

-665

20

1683

1681

1711

-28

2303

-620

21 1667n 1675 1695n -28 2280 -613
26 - 1148n 1150n - 1538n (M) -390 (M)

28

870n

855

835n

+35

930n

-60

30

710n

701

743 (M)

+42 (M)

711 (M)

-10 (M)

MC

895n

930n

993

-98

1526

-631

MARKET STEADIES!

All participants were still in shock from last series’ falls and wondering what this week would bring. Showfloor chatter amongst the buyers that some business had been done on a variety of types just below current levels gave hope that the market may level out sooner rather than later. The AWEX EMI lost just 16 cents but did fall below the 1500 cent mark to 1497 - this result welcomed as good news after last week’s carnage. Fine microns bore the brunt of losses, < 19 micron 40/50 cents with broader types 20 to 30 cheaper with the odd superior style wool and NM type dearer. One sector that did advance was skirtings, 40 to 50 cents higher, just 10% passed-in. Crossbreds also reversed last sale’s collapse adding 25 to 45 cents. Cardings took the largest hit of any sector with the 2 MCIs on the east coast averaging 94 cent losses as LKS/LMS lost 100 to 200 cents while CRT/STN gave up 50 to 60 cents. The overall pass-in rate fell to 16%, a drop of 20% compared to the previous sale with 16% also withdrawn resulting in a third of the wool available at the start of the sale not sold.

This week’s sentiment was vastly improved when compared to the fortnight before, with a very cautious tone. The demand for wool has fallen sharply due to lack of confidence and partly to blame is the devaluation of the Chinese Yuan (CNY). One US$ buys over 7 yuan compared to 6.8 yuan in July. All the other external problems in the Northern Hemisphere are still well and truly in play and this week Germany announced that its economy is slowing as is Britain’s (they’re yet to admit it). Trouble is also brewing in SA as wool sales have been suspended indefinitely as frustrations re the requirements of current export certification of greasy wool into China were conveyed and the ensuing implications for buyers and growers. Auctions will resume ASAP when clarity is obtained regarding export certification requirements of greasy wool into China.

We still have spots available if you want to attend the Sheep Welfare Seminar on Tuesday. Please reply to the office by Monday on 6884 1004 or email admin@macwool.com.au.

Ag Concepts Fwd Prices as at 23 August, 2019

Micron

Date

Low

High

21

25-Sep-19

1660

1680

21

13-Nov-19

1650

1650


Free knitted woollen jumpers for poddy lambs. Call into our office in Dubbo or Macdonald Rural at Brewarrina and take as many as you need. Many colours and styles to choose from!

Main Buyers (This Week)

1

Tianyu Wool

2588

2

Fox & Lillie

2533

3

Aust. Merino

2515

4

Techwool

2330

5

Endeavour Wool

1985

6

G Schneider

1235

Eastern Market Indicators (AUD cents/kg clean)

1497 cents ê 16 cents compared with 16/08/2019

Northern Market Indicators (AUD cents/kg clean)

1521 cents ê 17 cent compared with 16/08/2019

   AUD/USD Currency Exchange

0.6783 ê 0.0001 compared with 16/08/2019

16 August 2019

Friday, August 16, 2019

 WEEKLY MARKET REPORT 

Week Ending 16th August, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S07/19

This Week

M07/19

Last Sale

S06/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2000

1963

2117

-117

3007

-1007

18

1932

1923

2075

-143

2682

-750

19

1766

1753

1923

-157

2465

-699

20

1711

1698

1909

-198

2398

-687

21 1695n 1694 1900n -205 2376 -681
26 1150n - 1320n -170 1507 -357

28

835n

830

1000n

-165

944

-109

30

-

659n

793n (M)

-134 (M)

736 (M)

-77 (M)

MC

993

1020n

1040n

-47

1515

-522

HORRENDOUS!!!

One word could best describe this week’s wool sale, ”HORRENDOUS” as all sectors of the market plummeted to have the AWEX EMI at its lowest level for 2 years, now at 1513. The fall was 163 cents for the series, 9.7%, which is the largest weekly fall since 2003 with the biggest opening day fall in 11 years. Finer types < 19 micron fell 100 to 150 cents while 19.5 and broader averaged exactly a 200 cent shellacking. Skirtings gave up 150/200 cents, crossbreds were back by 130 to 160 cents while cardings reversed last week’s gains to fall 20 to 80 cents depending on type. The national pass-in rate was 36% - the highest for 16 years with 17% withdrawn. The only exception to the massive discounts were the sub18 micron best topmaking/spinners style where reductions looked to be 40 to 70 cents and most non-mulesed types increased their premiums dramatically with some “NM” lots  commanding 60 to 400 cents clean over the indicator price as buyers report more and more enquiry for NM wool. Prior to recommencement of sales the premium was in 50 to 20 cent range. Our NM wools came from Gilgandra and Binnaway to Yeoval, Wellington and Gulgong that were paid handsomely for their wool.

Again the predicament for the wool market was external factors as global stock markets shuddered on the forecast of global recession on the horizon; the ongoing unrest in Hong Kong along with Brexit; the tariff wars and tension in the Persian Gulf which has most Western governments nervous. When this happens consumers become cautious and stop spending money thus slowing economic growth. Some good news is the US decision to delay some new tariffs from September to December following pressure from retailers fearing a negative impact on their turnover but, for Aussie wool producers, woolen clothing imports from China wasn’t granted the extension - this decision adding to Chinese processors’ concerns for orders for their Autumn/Winter season.

The Australian wool production forecasting committee met on Wednesday and, to no-one’s surprise, their forecast was down 5% to 285mkg for this current season due to ongoing drought resulting in less sheep (record prices for lamb and mutton) and low lambing rates that are hamstringing growers from increasing flock numbers. Buyers have reported sporadic volumes of business being done with the market soon to find a level.


Free knitted woollen jumpers for poddy lambs. Call into our office in Dubbo or Macdonald Rural at Brewarrina and take as many as you need. Many colours and styles to choose from!

Main Buyers (This Week)

1

Tianyu Wool

3689

2

Aust. Merino

2984

3

PJ Morris

1824

4

Fox & Lillie

1792

5

Techwool

1519

6

G Schneider

1328

Eastern Market Indicators (AUD cents/kg clean)

1513 cents ê 163 cents compared with 09/08/2019

Northern Market Indicators (AUD cents/kg clean)

1538 cents ê 166 cent compared with 09/08/2019

   AUD/USD Currency Exchange

0.6784 ê 0.0010 compared with 09/08/2019

9 August 2019

Friday, August 09, 2019

WEEKLY MARKET REPORT 

Week Ending 9th August, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S06/19

This Week

M06/19

Last Sale

S02/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2117

2070

2175

-58

2816

-699

18

2075

2040

2143

-68

2478

-403

19

1923

1920

2043

-120

2292

-369

20

1909

1909

2033

-124

2232

-323

21 1900n 1898 - -139 (M) 2210 -310
26 1320n 1316 - -57 (M) 1430n -110

28

1000n

994

1045n

-45

871

+129

30

774n

793

-

-68 (M)

648

+126

MC

1040n

1048

1010

+30

1466

-426

WOOL MARKET GETS TRUMPED!!

Wool sales resumed this week with the market copping a hiding. Talk late last week and early this week was positive for some sectors of the market but sentiment did a 360 degree turn as external influences took their toll. Large falls on both days saw the AWEX EMI collapse by 78 cents to 1676 as finer microns (< 18.5) lost 60 to 90 cents and 19s and broader shed 120 cents. Skirtings fell by 70 to 100 cents while XBs gave up 30 to 60 cents. The only positive sector of the market was Cardings, most types adding 20 to 60 cents to their pre-recess levels.

Why the sudden change?? The tit-for-tat trade war between US and China escalated to new levels this week with Trump announcing a 10% tariff on US$300 billion worth of Chinese goods bound for the US. In retaliation China devalued its currency (RMB/Yuan) after it fell to an 11 year low (at the start of the GFC) caused by the tariff measures imposed by America. A weaker yuan makes Chinese exports more competitive thus offsetting the impact of raised tariffs in theory making Chinese products cheaper for consumers. On the flip-side the weaker yuan makes imports going into China more expensive: coal, gas, iron ore and wool so the price paid is adjusted down to compensate. The Chinese move to make their exports more competitive strikes at the heart of Trump’s trade war with them with many economists predicting the yuan could be devalued by another 5% by the end of the year - more bad news for Aussie exports to China.

With the positive start to the season in early July and a 2.8% swing in the FRX since then, hopes the market could continue in the same vein were short lived. Despite the ongoing short fall in supply, confidence from mills in China has all but eroded, as sales are running at about half of the normal quantity and most plants running at about 60-70% of their capacity which, given the lack of volume, they are still processing 10 to 20% more wool than they can sell down the pipeline, thus the potential for more price falls. As global economic growth slows consumer demand wanes as the prolonged trade war has some economists talking recession if a resolution isn’t forthcoming soon. Next week has a similar volume of wool available but no sign that the market can rebound. Don’t forget to register for the Sheep Welfare & Husbandry Best Practice Seminar at the Garden Hotel on 27th August.

Ag Concepts Fwd Prices as at 5 July, 2019        

Micron

Date

Low

High

21

11-Sep-19

1850

1850

21 23-Oct-19 1900 1900

Free knitted woollen jumpers for poddy lambs. Call into our office in Dubbo or Macdonald Rural at Brewarrina and take as many as you need. Many colours and styles to choose from!

Main Buyers (This Week)

1

Fox & Lillie

5002

2

Tianyu Wool

3625

3

Techwool

3293

4

Aust. Merino

2292

5

Endeavour Wool

2122

6

G Schneider

1551

Eastern Market Indicators (AUD cents/kg clean)

1676 cents ê 78 cents compared with 12/07/2019

Northern Market Indicators (AUD cents/kg clean)

1704 cents ê 76 cent compared with 12/07/2019

   AUD/USD Currency Exchange

0.6774 ê 0.0192 compared with 12/07/2019

12 July 2019

Friday, July 12, 2019

WEEKLY MARKET REPORT 

Week Ending 12th July, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S02/19

This Week

M02/19

Last Sale

S01/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2175

2133

2133

+42

2793n

-618

18

2143

2116

2107

+36

2435

-292

19

2043

2054

2024

+19

2282

-239

20

2033

2046

2009

+24

2242

-209

28

1045n

1053

1030n

+15

924

+121

30

-

861

835 (M)

+26 (M)

684 (M)

+177 (M)

MC

1010

990n

981

+29

1453

-443

MARKET FINISHES DEARER!!

Hopes were high that the market could continue its recovery from last week for the final sale before the annual 3 week winter recess. Solid gains on both days saw the AWEX EMI add 31 cents to finish at 1754. The push to secure wool was evident from the opening lot through to the end of the sale as buyers were keen to finish outstanding orders and new business for prompt shipment that was written 2 weeks ago. The small volume of wool on offer and the favourable FRX certainly helped lift all MPGs by 20 to 45 cents - some types with “good specs” were in the order of 20 to 100 cents dearer than the indicators.

Merino skirtings outdid their fleece counterparts as excellent demand saw prices ascend by 70 to 90 cents for all types regardless of VM, micron or yield. Cardings also continued their recovery. This sector saw gains of 25/30 cents as the MCI broke back through the 1000 cent mark to finish at 1010, a 29 cent gain. Crossbreds weren’t immune from the rising market as well with 28 to 30 micron 15 to 25 cents to the good.

There was much relief as the market continued its good start to the season after the hiding it took in June. One alarming figure to come out of the 2 opening sales is the small volumes, 65,000 bales offered compared to 84,400 in the corresponding sales 12 months ago, 19,350 less (23%). Confidence is a massive driver in any commodity market and wool is no different. The resumption of sales in the 1st week of August will be closely watched to see whether the positive buoyant mood can be transferred into meaningful volumes of new business to stabilise the whole supply chain as a mini recovery for 2 weeks has not convinced traders that we’ve turned a corner. The elephants in the room are still there: China/US tariff war, global economic growth slowdown, Brexit troubles, Middle East unrest and the ability of end users (manufacturers to retailers) to still absorb the higher prices will all play critical roles in price determination into the spring. 

AWI, in conjunction with local shearing contractor Hilton Barrett, have created a new and innovative shearing shed design to address work efficiency/safety, flow of sheep, animal welfare and quality wool prep. The shed will be open for display on Saturday 27th July from 10am to 2pm. The shed is located north of Dubbo, turn west off the Newell Hwy at Brocklehurst (Burraway Rd) go 2.5km then turn right. More info at awi.com.au/events.

Ag Concepts Fwd Prices as at 5 July, 2019        

Micron

Date

Low

High

21

9-Oct-19

1900

1900

 21 8-Apr-20 1900 1900

Free knitted woollen jumpers for poddy lambs. Call into our office in Dubbo or Macdonald Rural at Brewarrina and take as many as you need. Many colours and styles to choose from!

Main Buyers (This Week)

1

Tianyu Wool

4131

2

Aust. Merino

3734

3

Techwool

3477

4

Fox & Lillie

3280

5

Endeavour Wool

2515

6

Modiano (Aust)

2036

Eastern Market Indicators (AUD cents/kg clean)

1754 cents é 31 cents compared with 05/07/2019

Northern Market Indicators (AUD cents/kg clean)

1780 cents é 31 cent compared with 05/07/2019

   AUD/USD Currency Exchange

0.6966 ê 0.0071 compared with 05/07/2019

5 July 2019

Friday, July 05, 2019

 WEEKLY MARKET REPORT 

Week Ending 5th July, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S52/18

This Week

M52/18

Last Sale

S51/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2133

-

2120

+13

2727n

-594

18

2107

2099

2090

+17

2443

-336

19

2024

2047

2002

+22

2289

-265

20

2009

2037

1984n

+25

2261

-252

28

1030n

1050

1060 (M)

-10 (M)

964

+66

30

-

835

835 (M)

0 (M)

675 (M)

+160 (M)

MC

981

939n

961

+20

1470

-489

FINALLY MARKET LEVELS OUT!!

The new season opened with, well not quite a bang, but a definitely better tone than the past 9 sales when losses totaled 228 cents since early May, just 2 sales adding up to a 71 cent gain and 7 weeks of falls worth 228 cents. On many occasions in this time did we hear that the market had bottomed out but that was not the case until this week. The market was solid on the opening day and strengthened at the end of the series to have all MPGs increase their values by 10 to 25 cents, the EMI up by 8 cents to 1723 as discounts for the inferior types shrunk and lots < 2% VM with the “right specs” were up to 20 cents higher than the indicators.

Skirtings’ fortunes also turned the corner as good style, low VM types added 10/20 cents to their previous values with all other lots fully firm. Cardings also shook off the falling trend to add 20 cents to the MCI as all wools in this sector rose by 10 to 30 cents. Crossbreds were the only sector not to see a price advancement as they couldn’t recover the 10/15 cent loss from the opening day.

A good start to the new season as new-found confidence and a change of sentiment has the market finally finding a level after several false starts in May/June. Plenty of business had been written over the weekend where mills were happy that the market had fallen to a level that allowed far more business to be written than over the past month. The outcomes from the G20 meeting where the Tariff War might be closer to a resolution and the historic meeting in Nth Korea seemed to stem the flow of global economic doom and gloom for now and paint a somewhat brighter picture for the short term.

Another factor for buyers to consider is the volume of wool on offer globally, especially merino wool. This sale had only 31,000 bales rostered, a fall of 13,000 (30%) from the corresponding sale last season and the smallest opening sale for the season since AWEX started in 1995. Final figures for the 2018/19 season are in and total wool tested by weight for the year was down by 11.7% nationally and 19% back in NSW. The average for the EMI was 1909c/kg and $2139/bale. The total volume of wool sold was down by 16% on the previous season, this due to less volume and the pass-in rate doubling from 5 to 10% and total value of the clip sold was $3.174 billion down from $3.424 billion the year earlier. The final sale before the 3 week winter recess has 34,800 bales on offer, hopefully a firm finish.

Ag Concepts Fwd Prices as at 5 July, 2019        

Micron

Date

Low

High

21

23-Oct-19

1900

1900

 21 11-Dec-19 1875 1875

Free knitted woollen jumpers for poddy lambs. Call into our office in Dubbo or Macdonald Rural at Brewarrina and take as many as you need. Many colours and styles to choose from!

Main Buyers (This Week)

1

Techwool

3310

2

Tianyu Wool

3221

3

Aust. Merino

2916

4

PJ Morris Wool

2528

5

Fox & Lillie

2400

6

Endeavour Wool

2270

Eastern Market Indicators (AUD cents/kg clean)

1723 cents é 8 cents compared with 28/06/2019

Northern Market Indicators (AUD cents/kg clean)

1738 cents é 7 cent compared with 28/06/2019

   AUD/USD Currency Exchange

0.7037 é 0.0043 compared with 28/06/2019

28 June 2019

Friday, June 28, 2019

WEEKLY MARKET REPORT 

Week Ending 28th June, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S52/18

This Week

M52/18

Last Sale

S51/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2120

-

2217

-97

2872n

-652

18

2090

2068

2187

-97

2524

-434

19

2002

2016

2090

-88

2368

-366

20

1984n

2008

2071

-87

2346

-362

28

-

1060

1091 (M)

-31 (M)

1028 (M)

+32 (M)

30

-

835n

885 (M)

-50 (M)

695 (M)

+145 (M)

MC

961

921n

985

-24

1482

-521

SEASON ENDS ON A SOUR NOTE!

Hopes of a solid market faded early in the week as futures were traded as much as 50 cents lower than the spot price indicating yet another bad sale ahead. Both days had similar losses to see the AWEX EMI collapse by 51 cents to 1715, now at its lowest point since December 2017. The worst performing microns were 18.5 and finer that fell by an average of 100 cents while broader MPGs gave up another 80/90 cents as 25% of the national fleece catalogue was passed-in with low yielding, tender types 150 to 200 cents cheaper than their superior counterparts, the finer the micron the bigger the discount.

Room 2 wools weren’t as adversely affected as skirting’s fell by 50 to 70 cents. Cardings looked to be the least affected sector as the MCI fell by 24 cents to 961 as most types retreated by 10 to 50 cents. This puts the Carding Percentile at just 12% for the past 5 years, ie it has been higher 88% of the time over the past 5 years.  The peak of 1563 was September, 2018, a 44% fall to today’s level. With the only meaningful volume of XB wool available in Melbourne their quotes had 28/30 microns off by 30 to 50 cents.

The market has ended the season on a sour note at 1715, a 400 cent fall from the dizzy heights of mid August when it peaked at 2115, a 19% fall. The EMI spent 11 weeks above the 2000 cent mark and 19 sales in the 1900s and 15 weeks below 1900.The month of June has seen a massive drop in the EMI, falling by 172 cents (9.1%), second only to the biggest monthly fall of March of 1991 when the Reserve Price Scheme was abolished. The year on year figures of wool offered show a drop of 11.9% - 225,180 bales less than last season. The actual volume sold was 296,325 bales less (16.6%) than last season. The FRX has had little movement over the year, depreciating by 3.63 cents with the pass-in rate climbing to 10.5% for the season from 5.6% the previous year. Is this the end of the “super-cycle” that started in 2016?? Despite the falls in the latter part of the season the 3 regional indicators are all higher than the commencement of the 2017/18 season.

Reasons are varied for the fall from grace for wool prices. As the global economy slows and consumer spending patterns tighten, excess stock of wool products from garments to tops are being reported in China. This, combined with the ongoing trade war (US/China), Brexit troubles and the attacks on the two oil tankers in the Middle East, we are sailing into uncertain times as global confidence wanes. Buyers are reporting no change in direction for the wool market to open the new season.

Ag Concepts Fwd Prices as at 28 June, 2019        

Micron

Date

Low

High

21

11-Dec-19

1900

1920


Free knitted woollen jumpers for poddy lambs. Call into our office and take as many as you need.

Many colours and styles to choose from.

Main Buyers (This Week)

1

Tianyu Wool

2914

2

Aust. Merino Exp.

2302

3

Techwool

2240

4

Endeavour Wool

1940

5

Fox & Lillie

1927

6

PJ Morris Wool

1406

Eastern Market Indicators (AUD cents/kg clean)

1715 cents ê 51 cents compared with 21/06/2019

Northern Market Indicators (AUD cents/kg clean)

1731 cents ê 58 cent compared with 21/06/2019

   AUD/USD Currency Exchange

0.6994 é 0.0102 compared with 21/06/2019

21 June 2019

Friday, June 21, 2019

WEEKLY MARKET REPORT 

Week Ending 21st June, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S51/18

This Week

M51/18

Last Sale

S50/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17.5

2210

2167

2262

-52

2702n

-492

18

2187

2138

2238

-51

2538

-351

19

2090

2099

2144

-54

2374

-284

20

2071

2073

2128n

-57

2356

-285

21

2068n

2068

2120 (M)

-52 (M)

2344 (M)

-276 (M)

28

-

1091

1101 (M)

-10 (M)

1048 (M)

+43 (M)

30

-

885n

914 (M)

-29 (M)

699n (M)

+186 (M)

MC

985

953n

997

-12

1495

-510

FINALLY, IS THIS THE BOTTOM?!!

Just when we thought the wool market couldn’t get any worse it did. The AWEX EMI collapsed by another 57 cents to 1766, eclipsing the low point in early November (EMI at 1776) and now at its cheapest level since March, 2018. All MPGs fell by 45 to 60 cents with even the good spec types not immune from the lack of support for the first time in many weeks. 20% of fleece wool was passed-in on the first day as some lots were up to 100 cents cheaper or completely neglected.

Skirtings suffered the same fate as their fleece cousins, low VM (< 3%) with good L&S results lost 20 to 30 cents while the dusty, burrier types falling by 50 to 80 cents. Cardings continued their losing run as LKS remained unchanged while STN/CRT gave up another 20 to 40 cents. Crossbreds also couldn’t muster any support either as falls ranged from 10 to 30 cents for most types.

Buyer support was almost non-existent on the opening day as the market was almost in freefall despite the smallest weekly offering for exactly 10 years (19,000 bales) and the A$ falling below 69 cents and losing 1% against the Chinese Yuan. A lot of showfloor talk centred around the obvious lack of business and also possible defaults on payments through the processing pipeline - ie letters of credit (LCs) not being honored as financing issues for manufacturers bite as tight cash flow situations are hampering normal business practices. We could be at an attractive price that might see commitment to do business but the ongoing finance troubles and lack of supply to cover too much forward exposure is making mills hesitant to write big volumes of wool.

Most manufacturers sat out of the market as prices descended to what should be favourable levels but retailers are very hesitant to place new orders as consumer demand falls amidst slowing economic growth globally, Brexit uncertainty and the ongoing US/China tariff war restricting confidence. The movement of tops, carbo and yarn to fabric and garments is essential for the predictability of demand through the entire supply chain.

Despite the big opening day’s losses there was a definite change of attitude on the final day as prices steadied and losses were kept to a minimum even with the largest Chinese indent buyer still sitting on the fence and one of the other operators still purchasing but not to their full extent. We thought the bottom was a few weeks ago (1833) but the market has lost 121 cents over the past 3 sales. Hopefully this is it?? Will supply over-rule demand as SA now go into recess till mid August? With 3 sales to go here we are the only source of global supply in the short-term. A few buyers this morning thought that the market might hold at these levels after a bit of inquiry overnight and some business being written. Let’s hope so!!

Free knitted woollen jumpers for poddy lambs. Call into our office and take as many as you need.

Many colours and styles to choose from.

Main Buyers (This Week)

1

Techwool

2167

2

Tianyu Wool

1472

3

United Wool Co.

1465

4

Aust. Merino

1338

5

Michell Aust.

1176

6

Fox & Lillie

1163

Eastern Market Indicators (AUD cents/kg clean)

1766 cents ê 57 cents compared with 14/06/2019

Northern Market Indicators (AUD cents/kg clean)

1789 cents ê 53 cent compared with 14/06/2019

   AUD/USD Currency Exchange

0.6892 ê 0.0020 compared with 14/06/2019