Weekly Market Reports


12 March 2013

admin Macwool - Friday, April 12, 2013

WEEKLY MARKET REPORT

Week Ending 28th March 2013

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

12/04/2013

Last Week

28/03/2013

Change

Last Year

04/04/2012

Yearly Change

17

1284n

1356n

-72

1676n

-392

18

1182

1263

-81

1495

-313

19

1158

1233

-75

1405

-247

20

1121

1192

-71

1356

-235

21

1111

1180

-69

1333

-222

22

1088n

1169n

-81

1301n

-213

26

790n

823n

-33

841n

-51

28

595

621

-26

648

-53

30

554

576

-22

583

-29

32

466n

483n

-17

511n

-45

MC

715

750

-35

743

-28

WE NEVER SAW THIS COMING!

If this week’s wool sale was a game of football the score would read something like this: Woolbuyers 60 or 70 - Woolbrokers 6. Yes, worse than the 50 to nil performance Parramatta put up against the Roosters a few weeks ago! Why did we give 6 points to the brokers you ask? Fremantle somehow dragged itself off the canvas on Thursday to record an 8 cent rise after free falling 64 cents on Wednesday. This large fall was the biggest daily drop in any centre for over 2 years. Their pass in rate of 50.4 % was the largest in that centre for over 10 years. Talk of a softer market filtered through on Friday and, based on the information given, we had a bit of a stab in the dark issuing appraisals. Melbourne opened the sales on Tuesday with falls across the board of 25 to 45 cents - this being in the range that was anticipated last week. Wednesday saw the market in free-fall as the losses ranged from 45 to 70 cents in Sydney up to 100 cents for 22s in the West. As said before, Fremantle did post gains on Thursday with the Eastern centres’ falls far less than the previous day (15 to 30 cents), but the damage had been well and truly done on Wednesday. By the end of the sale losses in the fleece sector ranged from 45 to 80 cents across the three centres. The EMI lost 60 cents now down to 999 cents, the lowest point since November last year. The regional indicators each lost between 55 and 70 cents with Fremantle having the highest regional indicator at 1030 cents. The national pass-in rate was 26%, with the Fremantle figure at a staggering 41%, with 42% of all fleece wool on offer on Wednesday passed in. This is not such a bad thing as this sends a definite signal to China that there is grower resistance to these levels. It will be interesting to see how much wool is withdrawn from catalogues over the next few sales.

Room 2 was not immune to the big losses suffered in the fleece room. Steady falls throughout the sale had skirtings 80 to 90 cents lower than pre Easter levels. Finer types >19 micron and heavy VM lots <12% fared worse with falls in the 100 to 130 cent range. Cardings recorded greater losses on the Eastern Seaboard than in the west. All types and descriptions were quoted 30 to 45 cents lower, with the MCI 35 cents back in Sydney compared to just a 10 cent fall in Fremantle. Crossbreds didn’t escape the carnage either, as all indicators recorded double digit losses. The finer end, 26 to 28s came off 25 to 35 cents while the broader types were less affected, giving up 15 to 20 cents.

A disastrous start to sales in the run through to the end of June. No-one saw this collapse coming, but a rising exchange rate (now higher than 105 US cents), concern over Europe’s climbing unemployment rate (now above 11% - the highest since the GFC started), and the debt crisis in Cyprus that has Banks in Europe nervous about the prospect of another bail-out (which none of them want to be caught up in), are all factors weighing heavily on the market’s ability to move higher. The tense situation on the Korean peninsular has Western governments in particular nervous about the next move the North will take. All this points to a lack of confidence. Confidence is a great thing which all markets need, but at the moment confidence is scarce, demand is quiet so China is quite happy to see the market retreat to a level they are happy with. Don’t despair, the market spent between early August to mid October and 2 weeks in November under 1000 cents, dropping as low as 927 cents. Let’s hope the market steadies next week on the back of Fremantle’s minor recovery on Thursday. We sell 1st up on Wednesday, offering 585 bales.

 

Ag Concepts Fwd Price Trades W/E 12 April, 2013

MPG

Maturity

Low

High

21

10-Jul-13

1100

1100

 

 

1

Viterra

4754

2

Fox & Lillie

3727

3

Lempriere (Aust)

2738

4

PJ Morris

2638

5

Techwool

2224

6

Tianyu Wool Pty Ltd

1956

7

Queensland Cotton

1953

8

Australian Merino Exp.

1448

9

Michell Pty Ltd

1145

 

Eastern Market Indicators (AUD cents/kg clean)                                    AUD/USD Currency Exchange

999 cents ê 60 cents compared with 28/03/2013                                   1.0520 é 0.0054 compared with 28/03/2013

 

Northern Market Indicators (AUD cents/kg clean)

1014 cents ê 68 cents compared with 28/03/2013

 

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