WEEKLY MARKET REPORT 

Week Ending 10th April, 2020

 AWEX Northern Micron Indices Comparison

MARKET STEADIES!

After last week’s disaster anything less than a solid market would’ve been met with tears. Fortunately the market did the right thing and recovered a minute amount of the previous series’ losses - the EMI up by 14 cents to 1301. All merino fleeces lifted by 10 to 35 cents. Skirtings moved ahead by 30 to 50 cents while cardings were unable to ascend in price giving up 10 to 20 cents across the board. Crossbreds had a mixed sale as < 28s were either side of firm while broader types lost 25/30 cents.

The large anticipated offering of 44,000 bales didn’t eventuate as mass withdrawals (22%) saw just 29,500 bales offered nationally. As global demand (especially in Europe & North America) collapses with import bans now in place in India and Europe we are virtually left with one market, China. Buyers are reporting that any weekly offering over 35,000 bales is too much both in volume and financially for China to handle on their own with quantity below this level being absorbed as this week’s sale proved. To help cap the volume of wool to be offered NASC (National Auction Selling Committee) has approved the proposal to limit the number of lots in each selling room to 1000/day in each centre sending a clear message that we will try to offer the volume that can be bought without too much angst.

There have been many varied opinions, from growers through to retailers, as to how the wool trade tackles the problems that Covid-19 has and will continue to cause our industry well into this year and beyond. It’s a given that the world will fall into recession and some economists even predicting a depression. Arguments for and against sales continuing, the July recess brought forward or shortened from its current form to 1 or 2 weeks have been the hot topics of discussion this week. Wool Industries Australia members met this morning and reaffirmed their support of free enterprise principles to allow the continuation of the exchange of ownership of wool in these difficult times. Sellers should be able to sell their wool to the highest bidder if they choose to sell and buyers also given that same right to buy wool or not to buy judged on their situation of finance and ability to sell wool down the pipeline through to the retailer. There is no support to cancel or suspend wool sales as New Zealand and South Africa have done.

Next week, which was originally a recess, has been added to the selling program with 21,000 bales on offer, this to avoid a backlog of wool should open-cry auctions be postponed due to Covid-19.

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Main Buyers (This Week)