15 March 2019

WEEKLY MARKET REPORT

Week Ending 15th March, 2019

AWEX Northern Micron Indices Comparison

AWEX INDEX	This Week S37/18	This Week M37/18	Last Sale S36/18	Sydney Change	Last Year Sydney	Sydney Yearly Change
17	2560	2445	2608	-48	2746n	-186
18	2472	2375	2520	-48	2328	+144
19	2340	2326	2381	-41	2027	+313
20	2309	2292	2340	-31	1912	+397
21	2291n	2277	2321	-30	1854	+437
26	1411n	-	1451n	-40	1153	+258
28	-	1141	1169n	-24 (M)	815 (M)	+326 (M)
30	-	921	945 (M)	-24 (M)	563 (M)	+358 (M)
MC	1238	1184n	1237	+1	1298n	-60

UNDER THE WEIGHT OF DUST!

It was another tough week as the EMI slipped for the third week in a row under the weight of an increasing catalogue of drought-affected dusty wools and back under the magical 2000 cent mark to finish 29 cents lower at 1979. The national average yield on merino fleece this week was 63.6%, the lowest in ten years.

Over the course of the week buyers continually adjusted downwards their limits on the low yielding types as they struggled to average them into their orders. On the other hand, the few well-measured lines for both yield and tensile strength saw very good competition and finished the week not far below the previous week. It seems this trend will continue for the foreseeable future and now is certainly the time to be pulling dusty backs out of fleeces to give the remainder a fighting chance. What is also set to continue will be the downward pressure on the sub 19 micron sector and we now see the 17 micron indices 186 cents below this time last year even though the EMI is 228 cents above last year’s level. We predict the gap to narrow over the coming months with an imbalance in offering squeezing the broader end and flooding the fine end.

The Foot and Mouth outbreak in South Africa could still be having an impact here but not positive. We did see a jump in the market three or four weeks back and some of that rise was attributable to the Chinese ban on SA wools. The downside is that there are exporters who have South African wool tied up in containers either at Chinese ports, on the water or still in SA awaiting a clearance, who also buy wool off us. These exporters (a couple of large ones) would be feeling a credit squeeze and this has the potential to impact our market here. South Africa produces about 50mkg per annum equivalent to about 14% of the Australian clip. The fall in production here this year will be close to the entire SA wool clip.

Next week a larger catalogue of 44,000 bales will be offered in three centres with Macwool to offer 760 bales on Wednesday. I think you might have gathered by now we expect a similar trend for next week.

Ag Concepts Fwd Prices as at 15 March 2019

Micron	Date	Low	High
21	12-Jun-19	2250	2250
21	9-Oct-19	2115	2115

Main Buyers (This Week)

1

Techwool

4188

2
Tianyu Wool
3618

3

Seatech Ind.

3407

4
Aust. Merino
3307

5
Kathaytex
2329

6

Endeavour Wool

2158

Eastern Market Indicators (AUD cents/kg clean)

1979 cents ê 29 cents compared with 08/03/2019

Northern Market Indicators (AUD cents/kg clean)

2027cents ê 31 cents compared with 08/03/2019

AUD/USD Currency Exchange

0.7060 é 0.0012 compared with 08/03/2019

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Weekly Market Reports

15 March 2019

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