WEEKLY MARKET REPORT

Week Ending 19^th January, 2018

AWEX Northern Micron Indices Comparison

MARKET FLATLINES!

This week’s wool market couldn’t sustain last sale’s rapid rises as the AWEX EMI eased by 17 cents to 1801 while the Northern Region Indicator also lost ground by 7 cents to 1901. As the FRX pushed higher to nudge 80 cents and the big catalogue of 54,000 bales was on offer, this gave the buyers a chance to be a bit more selective with their purchases. Prior to Christmas (and last week) types with high mid-breaks and other faults had been swept up in the price hike as discounts were minimal. Suddenly the discounts for any type of fault came back into vogue as all microns (bar 17.5 and finer) suffered losses to some degree. Medium microns (19 to 21) lost 20 to 35 cents while 18/18.5 and 22s gave up 10 to 15 cents. As mentioned earlier, finer types bucked the cheaper trend as 16.5/17.5 were 5 to 15 dearer and 17s rose a healthy 35 cents - this resulting in the pass-in rate to rise slightly for fleece types to 1.9%

Skirtings looked to track 2 ways as the < 18 micron types with < 5% VM were in hot demand as buyers pushed these lots up by another 30 to 40 cents while the broader burrier skirtings with heavier colour/cott fell by 10/20 cents. The spectacular run that cardings have had also came to an end bar CRS which remained firm throughout the sale and LMS types that were 20/30 cents higher and some lots extreme. LKS and STN gave up 40 to 60 cents as the 3 MCIs are now 1501 to 1513 but still great levels. Crossbreds also reversed last sale’s dearer trends to fall back by 5 to 15 cents. 

Everyone was wondering when a correction might occur as the market has been on, what some might call, a “bull run” since mid October when the EMI was 1560 lifting to over 1800 while the MCI has tracked upwards to the tune of almost 300 cents (1230 to above 1500). Over this time there has only been 7 selling days of losses. Some buyers were surprised as to the rise and rise of the market given funding difficulties late last year and the volume of wool that had been sold compared to last season (up by 5% - 49,000 bales) but the market has more than absorbed this extra quantity. Reports from China that fresh business had slowed a touch and the FRX that did sneak above 80 cents and the big offering all led to the slight pull-back in prices on Thursday according to the experts. This brief respite from the frantic chase of supply and constant rising prices will be welcome by all mills but may only be a brief interruption to the ruling trend as many wool users look to have their immediate orders and machinery demands covered. As prices continued to rise till now many mills were nervous about passing on the new price levels particularly in the woollen sector. Ultimately retail sales will determine price movements but wool, especially Merino, continues to sell well in shops and online, remembering there is virtually no greasy stock in Australia and very little wool in front of machinery overseas waiting to be processed. We sell next Wednesday with 600 bales on offer.   

Ag Concepts Fwd Prices as at 19 January, 2018

Main Buyers (this week)