WEEKLY MARKET REPORT

Week Ending 26^th May, 2017

AWEX Northern Micron Indices Comparison 

BUYERS LET MARKET DRIFT!

The 3 separate markets did re-align themselves but the shift in prices went against growers. Consistent falls across both days in all centres saw the AWEX EMI fall by 27 cents to close below 1500 cents again at 1495.The strengthening A$ also led to the indicator losing  ground in US$ terms to 1122, a  13 cent decline.  The finer microns took the brunt of the falls as 18.5 and finer gave up 70 to 90 cents. The broader types had smaller falls; 19/20 micron fell 40 to 50 cents while 21 and coarser looked about 20 cents cheaper.  Only the finer lots with the right “specs” and a “spinners” style escaped any real price reduction with some “LB  to B” VM lots(1.5 to 4%) in the medium micron range looked solid to just buyers’ favour.

Skirtings also followed a similar pattern to the fleece room. The better style lots <3% VM and finer than 19 micron were only adjusted down by 10 cents whereas broader, burrier lots up to 8% VM fell by 40 to 50 cents with ever increasing volume of  lots containing heavy cot/colour becoming more unpopular, up to 80 cents  back from last week’s quotes.  The carding sector was the only one to find any semblance of buyer support as the 3 MCIs were in sellers’ favour by an average of 5 cents (1180 to 1201). Crossbreds were also caught up in the cheaper merino trend as all types gave up 5 to 10 cents.

The shine has certainly come off the market over the past 3 sales. Since the good (but unexpected) rise in the 1^st week of May the direction has been down - a 49 cent drop for the EMI in that time - undoing all those gains as all merino indicators are now 60 to 120 cents back from those levels.

Futures gave no indication of the falls that were to come as the lock-in price for 21s was at 1500 cents out to the end of June as this has fallen to 1475 today, bang on the cash level. Outside influences like the investigation into the Trump/Russian association before the US election and the  tragic bombing in Manchester, rattled global stock markets sending the US $ down against all foreign currencies - this not helping the market. The quality of the selection is also playing a part in the market’s retreat and, unfortunately, the reduced quantities not putting buyers under any pressure.  The sudden lack of interest from many overseas users has buyers on the back foot and reticent to continue their “buy and sell” trading pattern as the coverage of previously sold forward orders the only reason to buy.

Next sale will see volumes dip below 30,000 bales, the smallest national catalogue since August, but talk on the show-floor is that enquiry of fresh sales from overseas is also on the decline so a tough market could be on the cards in the short term.

Ag Concepts Fwd Prices at 26 May 2017

Main Buyers (This Week)