Weekly Market Reports


10 August 2018

admin Macwool - Friday, August 10, 2018

WEEKLY MARKET REPORT

Week Ending 10th August, 2018

AWEX Northern Micron Indices Comparison

 AWEX INDEX

This Week

S06/18

This Week

M06/18

Last Sale

S02/18

 Sydney Change

   Last Year

    Sydney

Sydney Yearly

Change

17

2816

2831

2793n

+23

2227

+589

18

2478

2480

2435

+43

2153

+325

19

2292

2328

2282

+10

1853

+439

20

2232

2246

2242

-10

1648

+584

21

2210

2230

2224n

-14

1576

+634

22

2184n

2201

2199n

-15

1519n

+665

26

1430n

-

1519n

-89

1119

+311

28

871

886

924

-53

817

+54

30

648

673

683n

-35

608

+40

MC

1466

1477n

1435

+13

1099n

+367

MARKET OPENS ON A SOLID FOOTING BUT DROUGHT STILL DOMINATES

Wool sales resumed after the 3 week annual winter recess. Of course with the break came an increase in volume - upwards of 50,000 bales rostered (8,800 more than Sale 2) but around 4,000 bales shy of the corresponding sale last year. As is always the case after a recess buyers were keen to talk the market down due to the big offering. Apparently, following Sale 2, a major buyer put offers out 20/30 cents below where the market finished and these offers were snapped up by Chinese mills and showfloor talk had the market retreating by up to 100/150 cents. The market opened on Tuesday with the anticipated fall of 10 to 30 cents for all fleece microns bar 18/18.5s. Was this the start of the 150 cent fall?? Thankfully not - a complete change in sentiment entered the auction rooms for the final 2 days to have < 19.5 micron to the good by 10 to 75 cents as broader types lost 10 to 20 cents. The AWEX EMI added a modest 6 cents to 1990 and 18 cents to 1480 in US$ terms as the FRX has barely moved either side of 74 cents for a month. One thing of note was the discounts for < 2% VM in fleece lots looking to have gone back to very little or, in some cases with the right specs, no penalty, some lots up to 20 cents above the indicator. Even burry types > 2% looked to have their discounts softened when compared to end June/early July when these penalties looked excessive.
Skirtings followed the lead of the fleece types, an opening cheaper session followed by renewed buyer activity to end the sale to have all descriptions and VM levels 20 dearer for the week. Cardings also mirrored their merino counterparts. After a cheaper opening session they came home with a wet sail to finish the week 10 to 20 cents higher. Crossbreds also took their lead from the merino sector but a last day recovery couldn’t push them into positive territory. The losses were in fact heavy, 26s down by 90 cents while 28 to 30 micron fell by 35 to 50 cents whereas the broader microns were unchanged. These big falls probably attributed to the Northern Hemisphere shearing still under way which is virtually all XB wool leading to an over-supply of > 26 micron wool.

A good way to kick off sales after the 3 week break as the bigger quantity was easily absorbed into buyers’ inventory. European buyers and forward sellers lead the way especially on the better style/finer types which forced the Chinese mills to join the fray to meet supply requirements, despite the US$ now appreciating by 10% against the CNY-Chinese yuan. Volume drops back to 37,000 bales next week. Should be solid to dearer.

          Ag Concepts Fwd Prices as at 10 August, 2018

Micron

Date

Low

High

21

19-Sep-18

2150

2150

21

12-Dec-18

2075

2075

21

10-Apr-19

2010

2010

 

Main Buyers (this week)

1

Techwool 

7636

2

Fox & Lillie

5323

3

Lempriere

3837

4

PJ Morris

3233

5

Aust. Merino

3205

6

Endeavour Wool

2880

7

Kathaytex  Aust.

2486

8

Modiano

2073

9

Tianyu  Wool

1533

Eastern Market Indicators (AUD cents/kg clean)

1990cents é 9 cents compared with 13/7/2018

Northern Market Indicators (AUD cents/kg clean)

2027 cents é 14 cents compared with 13/7/2018

AUD/USD Currency Exchange

0.7438 é 0.0056 compared with 13/7/2018


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