WEEKLY MARKET REPORT 

Week Ending 24th January, 2020

 AWEX Northern Micron Indices Comparison

HIGHER VOLUME STRETCHES MARKET

The market opening felt the pain of the increased volume of bales in the Australian wool market this week. After last Tuesday’s increases between 100 and 120 cents, this week’s offering jumped from earlier predictions of 49350 bales to 59900 bales. With this came discounts from the start as buyers struggled to find the finance for sudden increased volumes of wool.  A three day sale in Melbourne saw them open up, selling on their own, on Tuesday. The softer tone was evident when selling began in the merino sector. The individual Micron Price Guides (MPGs) for 17.0 micron and coarser falling by 14 to 40 cents by day’s end.

As Sydney did not sell last Thursday or Tuesday this week, everything was pointing in one direction for when our market opened Wednesday. Fremantle was in the same boat and both centres were pulled back to match Melbourne’s levels. Freemantle dropped between 9 and 31 cents, not as great a drop as Sydney due to Freemantle selling last Thursday and taking some of the losses then. Sydney, however, dropped between 37 and 110 cents of which 19 micron and broader took the biggest brunt of the losses losing between 98 and 110 cents respectively. These drops, compared to the previous Tuesday’s sale, meant that a lot of wool was pulled out of the market ending in a week where the offering ended up being 52,666 bales of which 15.9% was passed in, continuing at historically higher than normal rates. Thursday seemed to find a consolidated level across all three centres as buyers seemed to be happy with securing as much wool at these levels as they could. By the end of Thursday’s selling period the market seemed to be a bit more positive. All wool types were very firm to 10c dearer with most attention drawn back to the merino fleece sector of 19 micron and broader.

The AWEX Eastern Market Indicator (EMI) lost 33c or 2% this week to move to 1576c clean/kg. The EMI in US Dollars (USD) was lower again as the 0.6% lower exchange rate helped depreciate that indicator by 2.6%. The USD EMI adjusted down to a 1082c US clean/kg close for the week which was a 29 USC loss. Even with these drops the EMI is still 18c clean/kg ahead of the last sale before Christmas - still very good levels. Merino Skirtings had strong support all week ending the week fully firm to 20 cents dearer across all microns. The oddment sector defied the trend of all other sectors. Locks in particular were well sort after pushing prices up by 30 to 40 cents. The crossbred sector took a fair hit this week as well as they seemed to be out of favour with the buyers all together losing between 21 and 84 cents.

Next week sees another 40680 bales go under the hammer. As Monday is a public holiday there will only be two selling days, Wednesday and Thursday. Also China will celebrate their lunar New Year and will pretty much be shut for the week so it will be very interesting to see how our Australian Wool Market performs. Fingers crossed, firm to dearer!

HAPPY AUSTRALIA DAY and safe travels to anyone travelling!

Southern Aurora Fwd Prices              

Main Buyers (This Week)