WEEKLY MARKET REPORT 

Week Ending 17th January, 2020

 AWEX Northern Micron Indices Comparison

NEW YEAR BUT SAME RESULT!

As has been the case for a number of years now the market started the new year with a bang. After last week’s 5% rise in the South African market talk on the showfloor was of a similar scenario. The chatter was spot on as all merino microns added 100 to 120 cents on Tuesday on the Eastern Seaboard. On Wednesday, as Fremantle came on line, Sydney was a fraction cheaper (10 cents) Melbourne mixed and after an explosive start Fremantle could only add 30/40 cents to their pre-Christmas values as talk of a correction was common. The big downward price adjustment came on Thursday with Sydney not selling with the other 2 centres as all microns lost 25 to 100 cents. After the wild fluctuations the AWEX EMI did post a 51 cent rise to 1609.

Skirtings also benefitted from the initial jump in the market to have this sector 70/90 cents to the good with cardings ranging from 40 to 70 cents higher. The crossbred sector couldn’t go with their merino counterparts and added just 10 cents to their values. With the market’s jump the EMI is equal to its spring peak in late September (1609) and just the 2^nd occasion since August that 1600 cents has been achieved. Even though the market rose there are big price discrepancies between the 3 centres. As Sydney escaped the big closing falls on Thursday we are well ahead of Melbourne’s levels (78 cents on 18s and 19 to 21s, 40 cents for 16.5 to 17.5 and 18.5s.) This could signal more price reductions next sale as growers rushed wool into next week after Tuesdays jump to try and capture the rises pushing the roster to 59,900 bales, a 14% (8,100 bales) increase since Monday. It will be the largest sale since April 2018. This opening sale (52,200 bales) was the largest since the corresponding sale last year. Buyers are somewhat perplexed as to why growers continue to rush wool onto the market after big rises pushing volumes to levels where finances aren’t enough to buy all the wool on offer at competitive levels. If the rises weren’t so large, like before Christmas and late October, we could avoid the situation of big rises leading to large offerings, then buyers virtually running out of money to buy all the available wool and the market losing all the previous gains. Buyers seem to think that volumes over 45,000/sale becomes a bridge too far. That doesn’t augur well for next week and then Chinese New Year the following sale. Some exporters did write some business last night - enough to steady the market next week is anyone’s guess.

Southern Aurora Fwd Prices              

Main Buyers (This Week)