WEEKLY MARKET REPORT

Week Ending 20^th May, 2016

 AWEX Northern Micron Indices Comparison

MARKET FLATTENS OUT

 This sale sees us in uncharted territory, almost! This week was the 4th in a row that the wool market has posted gains. The advancements did slow to a crawl - a 4 cent rise to 1291 for the EMI - as sectors other than fleece were the main drivers for the positive movements. In US$ terms the shift was more pronounced: a 14 cent fall to 931, the largest movement either way for 4 weeks, again the wild exchange rate swings the main contributor as the A$ did dip below 72 cents on Thursday (71.85) following the release of  the unemployment figures. As mentioned, fleece types didn’t influence the market’s direction to any degree. Price movements were dictated by the type on offer - 17s and finer were 10 cents dearer with the best style FNF lots now commonly commanding premiums of up to 100 cents above the indicator. All other indicators were unchanged bar 19s (back by 5) and 21s off by 10 cents, now just a hair’s breadth above 1400 cents.

Skirtings followed the pattern set a few weeks ago. All types across the full micron range up to 6%VM added 5 to 10 cents to their weekly values with the small volumes of better style lots again keenly sought after, up to 50 cents higher. Cardings continued to get dearer as the 3 centres’ MCIs are now identical, 1089 in Sydney with the other 2 centres at 1088. All types in this sector were quoted up to 10 cents better. Crossbreds were the sector that helped push the EMI higher. The more favourable exchange rate saw rises up to 15 cents for 25 micron and 28s and broader while 25 to 28s were the best performers in Melbourne jumping 20 to 30 cents.

Once again the exchange rate dictated price movements. The release of the RBA’s board meeting minutes saw the A$ strengthen to mid 72s only to see a downward adjustment after the unemployment figures were made public to under 72 - an 8% fall over the past month. Also on the radar is talk of a definite move on rates in the US soon and maybe 1 or 2 more cuts here before December. The extra quantity making this the largest national catalogue for 5 sales didn’t affect the market. Fleece prices stood up well under the weight of the 5^th largest fleece selection for the season - 64% of the total - XBs now making up just 10 % of the whole selection.

Next week will see just the two Eastern seaboard centres in operation as Fremantle has a week off with only 30,000 bales on offer, the smallest since mid August. With South Africa set to go into their mid-year recess and NZ’s supply diminishing, pressure will be on the buying trade to fulfil their commitments as demand outstrips supply. Forecasts are for a good market.

Ag Concepts Fwd Prices at 20 May 2016

Main Buyers (This Week)