Week ending 13^th May  2011

Northern Micron Indices Comparison: Source of information: AWEX

MARKET STAGES A RECOVERY

The recovery of last Thursday kept going as the market has clawed back some of the ground lost before Easter. The EMI added 17 cents to now sit at 1327 cents. Predictions of a cheaper market by as much 40 cents for “off style” types early in the week were off the mark.  The change in sentiment actually came from the annual IWTO conference being held in Hangzhou, China. At the dinner held on Tuesday night, hosted by the Chinese Wool and Textile Association, reference to supply of wool staying at these levels (or even slightly lower) led to a stampede of delegates to ring their agents to book up wool post–haste. This frenzy of business led to the market  adding 10 to 25 cents for all indicators out to 23 micron on Wednesday - this despite the exchange rate climbing from under 107 cents last Friday to over 108 cents early this week. Thursday’s market continued to rise to the tune of 10 to 20 cents for 19.5 and broader while finer types held their ground. As is always the case, discounts for colour, cott and vm shrunk noticeably which benefitted us greatly as just 6 out of 88 fleece lots were under 2% vm with a good number of lots containing reasonable amounts of cot and colour of which most cleared to the trade. By week’s end rises of 15 to 45 cents were the norm for most indicators leaving the EMI 51.2% higher than the same week 12 months ago. The highlight of the week was the sale of 2 bales of 1PP a/c The Wool Factory from Horsham in Victoria, with both bales achieving a price of 20,000 cents. One of their other bales bought 15,000 cents with the 3 bales averaging 12.1 micron, 0.1 vm, 75%, 76mm and 40nkt. G Schneider secured these 3 bales, with one bid apparently, for knitting and weaving in Biealla, Italy.

Skirtings had mixed results with the heavy-fault and cotted types continuing to slip in price while selected lots of finer types with low vm gained as much as 50 cents. Some lots with slight cot and heavy vm, up to 15% sold to a dearer trend as well. Cardings hung on well until late on Thursday when locks and stains lost 10 cents. Crossbreds struggled to move in any direction with the exception of some better style 29 and 30 micron lots which were quoted 10 cents up on last week’s levels.

Predictions of a solid market for the immediate future seems to be the talk on the showfloor as weekly quantities fall to around 40,000 bales, with Fremantle starting a series of one day sales this week. As one buyer said this morning, lack of supply will keep pressure on buyers not currency movements. One can only hope this will be the case for sometime. The national offering is 40,000 next week with our catalogue numbering 700 bales with an unchanged to dearer market anticipated.

Agrisk – CBA Wool Futures Mid-Point Quotes 06/05/2011

MAJOR AUCTION BUYERS (Bales)

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

                Eastern 1323 cents (é17) compared with 05/05/11                            1.0618 ê 0.0118 compared with 05/05/11

                Northern Market Indicators (AUD cents/kg clean)

                Northern 1384 cents (é15) compared with 05/05/11