WEEKLY MARKET REPORT

Week Ending 13^th January, 2017

AWEX Northern Micron Indices Comparison

A LATE CHRISTMAS PRESENT!

The market exploded into action at this week’s resumption from a well earned 3 week Christmas recess.  Even as far back as the Friday before Christmas, the opening week of the recess, business had been brisk (to say the least) with plenty of wool being booked up and far more enquiry than local traders can remember in a sale recess for quite some time.  Concerns of a drop off in supply and increasing demand coupled with the $A falling below 72 cents and the 3 week recess, forced exporters to start the year off with buying vigour not seen for a long time. Talk of the market opening up to 50 cents dearer was spot on in Melbourne on Tuesday, the gains in the order of 35 to 75 cents. This momentum continued on in earnest on Wednesday and Thursday. By week’s end <18 micron saw climbs of 130 to 165 cents. 21 to 18.5s benefitted by 80 to 110 cents while 22s and broader up by 50-60 cents. The EMI posted a 67 cent jump to 1422 and a 56 cent lift in $US terms to 1056. Just 34 bales of fleece were passed-in in Sydney, clearing 99.4%.

Skirtings were also caught up in the price hike of their fleece counterparts. Finer lots <19 micron containing <5% VM were quoted 80 to 120 cents higher with the medium types with over 5%VM adding 60-70 cents to their pre Christmas values with 9 lots of “BKN” making  1050 to 1246 cents. Cardings were also caught up in the big price rises with all types in this sector 30-40 cents to the good. The 3 carding indicators range from 1163 to 1171, now into record territory.  We had “CRT” make over 1000 cents and “LKS” from the same clip 828 cents. The Crossbred sector was stagnant, 25 to 28 and 32 micron in sellers’ favour with 30 micron down by 20 cents with most commentary on this sector predicting more pain to come before any sort of recovery at least 6-12 months away.

A great sale to be in if you’re offering Merino wool but still not so good for Crossbred growers. Bidding at times was frantic and at times “buy at best” was the only option buyers looked to have up their sleeve. The EMI, at 1422, is at its highest level since June 2011 - five and a half years ago and now only 3 cents shy of that peak. Good news for fine-wool growers as the recovery for finer, <19 micron continues as fine, long wool types are back in vogue. The gap continues to widen between fine and broad microns - 238 cents from 21 to 19s and a 274 cent gap from 20s to 18 micron.  55,000 bales are on offer next week but keen demand should see the trade absorb this quantity without too much trouble. We sell late in Thursday with 1465 bales on offer.

Ag Concepts Fwd Prices at 13 January 2017

Main Buyers (This Week)