WEEKLY MARKET REPORT

Week Ending 2^nd September, 2016

AWEX Northern Micron Indices Comparison

MARKET CLOSES IN ON 12 MONTH PEAK

All the good judge’s forecasts rang true as the favourable exchange rate (falling by over 2.5 cents in 2 weeks) drove buyer competition to new levels. The longer fibred wools (merino and crossbred fleeces) are in good demand as some overseas users are finding it somewhat problematic to get set for larger quantities from exporters to ensure supply at current rates. Surprisingly, the shorter wools and cardings remain subdued as manufacturers try to establish a new buy-in price that will stimulate sales of garments made from these types into the Northern Hemisphere winter.

Plenty of activity in the futures market as 75 tonnes was traded this week out till May 2017 - 21s at 1370/80 - with September trading at 1450/60 for the same micron, just 20/30 cents below the physical market and 1430 for early November. These prices are at historically high levels.

This current rain event will impact on shearing being delayed and wool receivals slowing to a walk. Volumes for Sale 12 and 13 will be smaller than forecasted applying pressure to buyers as the catalogues shrink in the short term and, with the anticipated wettest September for years (20+ days of rainfall is all the talk), this situation could drag on for longer than we think. The national catalogue is just shy of 43,000 bales next week. We open proceedings on Thursday with a 1000 bale catalogue and a firm to unchanged market is expected.

Ag Concepts Fwd Prices at 2 September 2016

Main Buyers (This Week)