Weekly Market Reports


26th March, 2021

admin Macwool - Friday, March 26, 2021

WEEKLY MARKET REPORT

Week Ending 26th March, 2021

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S39/20

This Week

M39/20

Last Sale

S38/20

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2102

2068 2063
+39 1883n +219

18

1799

1785

1769

+30

1754

+45

19

1571

1573

1566

+5

1665

-94

20

1365

1364

1350

+15

1632

-267
21 1280n 1273 1262n +18 1609n -329
 26 - 788n 785n (M) +3 (M) 1081n (M) -293 (M)

28

510n

519

510n

0

871n

-361

MC

876n

898n

864n

+12

987n

-111

LOGISTICS DELAYS HINDER MARKET’S RISES!

Many things are conspiring to dampen the wool market’s ability to go to “the next level”. A common theme was that when the vaccines were rolled out en masse the lockdowns and restrictions were being eased and consumers would go back to their old spending habits raising the demand for wool significantly. This may well be the case but recovery seems to be getting pushed back further and further - well into the 2nd half of this year and even into 2022 - as some European countries now experience a 3rd wave of Covid-19 and a much slower than hoped vaccination rollout. Great Britain and the US look to be well on track with their vaccines but Europe is very slow and, in fact, some countries have reintroduced lockdowns and restrictions that will slow the rate of economic recovery in the Northern Hemisphere.

The market only added 8 cents to its overall value taking it to 1285 for the EMI despite the FRX falling by almost 3% to 76 cents from over 78 a week ago. With the falling A$ the market, in US$ terms, followed suit losing 23 cents to 977, a good result for all as growers benefitted from a small rise in the market and exporters were on the receiving end of a cheaper buy in price for their orders. Finer fleece types saw the best competition as < 18 added 30 to 40 cents with broader lots 5 to 20 cents better. Growers warmed to this renewed buying activity as just 67 bales (1.7%) were passed in. Skirtings added 15 to 25 cents for 18.5 micron and broader with lots finer than this fully firm. Cardings also upped the ante with all types in this sector lifting by 5 to 30 cents depending on style, VM and micron. All centres’ MCIs are now aligned in price (876 to 898). Crossbreds had the least movement of all the sectors with most microns in sellers’ favour by up to 10 cents.

With the favourable FRX and the vastly reduced national catalogue, from 46,500 bales late last week to 38,500 bales offered (a 17% reduction) and the smallest offering since December - normally the market could’ve risen by 20 to 30 cents. No doubt the FRX and the smaller volume did help the market with all other currencies used in wool trading prices actually falling by 2 to 3%. Despite the wool market’s level with consumer demand still nowhere near where it was pre pandemic, the single issue restricting the market’s ability to rise is the seemingly worsening logistical issues from dumps to final destination. The delays in shipping are verging on chronic with exporters receiving multiple cancellations of ships leading to weeks and now in some cases months of delays tying up 10s of millions of $ in finance. Some reports indicate the notice time for cancellations are extremely short with wool dumped and ready for loading onto the vessels at the port being jettisoned off delivery and a new schedule “subject to change“ being issued. Some exporter’s containers have been cancelled 3 times from loading onto ships. India and European destinations are faring worse than China as ships bound for these ports are low in number and container space very limited and booked out well in advance of what was the norm a year ago. Next week has a national catalogue of 48,800 bales on offer. Hopefully a bit more business has been written to lift the market.


        Southern Aurora Fwd Prices            

Micron

Date

Low

21

April-June 21

1270

Main Buyers (This Week)

1

Techwool

4682

2

Tianyu Wool

3571

3

Endeavour Wool

3327

4

Fox & Lillie

3024

5

United Wool

2363

6

PJ Morris

1190

Eastern Market Indicators (AUD cents/kg clean)

1285 cents é 8 cents compared with 19/03/2021

Northern Market Indicators (AUD cents/kg clean)

1356 cents é 14 cents compared with 19/03/2021

   AUD/USD Currency Exchange

0.7606 ê 0.0227 compared with 19/03/2021


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