WEEKLY MARKET REPORT

Week Ending 20^th April, 2018

AWEX Northern Micron Indices Comparison

BACK INTO RECORD TERRITORY

With last week’s 54,000 bale offering behind us and production forecasts now prophesying a decline in wool production it wasn’t that surprising to see the market push further into record territory. The offering of 39,605 bales saw the EMI end the week just 9 cents short of its all time high set late February but it was the 21 and 22 micron indicators that set new highs. It is quite conceivable that we could see 21 microns reach 2000 cents clean in the coming weeks!

The pace gathered slowly as the week progressed and clearly it was the medium wools where the strongest competition was. Fine wools, which led the rises late last year appeared to have plateaued with fewer of the best style lines on offer. Seasonal conditions are now impacting the quality of the offering with fleece wools under 65% making up over half the offering. Buyers are struggling to fill orders with enough high yielding, sound lines so discounts for lower average types will likely increase. Competition was mainly from Chinese interests but this week saw increased interest from Indian connections who punted some time back that the market would fall. It seems their stock levels will have depleted so it was either suck it up and wade into the market or shut up shop.

Crossbred wools this week also posted solid gains to hit a two year high with fair to average XB clips back to averaging over $1000 a bale. Merino oddments also saw another strong week with the carding indicator rising for the fourth consecutive week, about 100 cents for the month.

Next week is looking promising as Fremantle (which sells for two hours after Sydney and Melbourne close) continues to strengthen, normally a positive sign for the coming week. There is a slightly higher offering next week of 43,648 bales which shouldn’t pose too many problems. There is almost no wool stored on hold and brokers receivals are starting to lighten off as the impact of essentially 12 months of below average rain stalls production. Winks might be the safest bet in town but the next safest bet would be that this market won’t drift much over the coming weeks. Wool sales straddle Anzac Day next week with MacWool to offer a stylish catalogue of 1085 bales on the second day.

                                                         Ag Concepts Fwd Prices as at 20 April, 2018

Main Buyers (this week)