WEEKLY MARKET REPORT

Week Ending 28^th August, 2015

 AWEX Northern Micron Indices Comparison

ANOTHER BAD WEEK BUT …??

The wool market continued in the same vein as the last sale as falls were widespread across all sectors. The gains in the 2 opening sales following the 3 week winter recess have now dissipated as the EMI has now lost 82 cents over the past 2 sales after posting an 83 cent jump in value the fortnight before. The opening day was savage as 18s and broader fell 45 to 55 cents with the super-fine types back by 30 cents. The final day of sales was less painful as losses were restricted to a 10 to 20 cent range as some spinner style types (finer than 18 micron) attracted strong premiums in the opening designated super-fine sale of the season. Even more encouraging was the performance in Fremantle on the final day as most microns added 5 to 10 cents giving some hope we may see a levelling market next week. Highlights were few and far between as discounts came to the fore as quite a few lots were almost neglected. The large drop in prices caught growers by surprise as 29% of fleece was passed-in.

The negative sentiment flowed into Room 2 this week much more than was evident last sale. By week’s end all types of skirtings regardless of style, micron or VM gave up 40 to 50 cents, bar the odd superior super-fine lot that is fetching prices within 100 cents of fleece wools. Cardings recorded very little movement as a final day adjustment saw stains lose 30 cents, crutchings 10 and locks fully firm. The 3 regional MCIs lost around 10 cents each, all now in a narrow price band - 1054 to 1067. Crossbreds also came through the sale relatively unscathed as 26s and finer lost 20 to 30 cents with 28 micron back by 10 with all others unchanged.

It looks as though prices may have levelled out as we have sold quite a number of passed-in lots since Tuesday’s auction with all buyers predicting a solid market as there seemed to be a scramble to buy wool today and last night. National volumes won’t be massive by any stretch as passed-in rates have been high over the past 2 sales - this week at 21.5% (the largest weekly rate for 18 months). The volatility of Global share markets over the past few weeks and the overwhelming forecasts of the Chinese economy’s growth slowing to below 5% certainly took its toll on the market as commitment to book up wool was almost non-existent. The lowering of interest rates in China this week and a lower A$ against the US$ could be the catalyst for a recovery in the market. We should know by early next week.

Away from the auction room the National Sheep Show and Ram Sale was held in Dubbo this week. The sale topper was a 19.8 micron ram from Roseville Park at $26,000. Hot on its heels was a Nerstane ram from Walcha at $24,000 measuring 18.9 micron, both going to syndicates from NSW, VIC and Tasmania. The next highest priced ram was a/c Langdene from Dunedoo and the NSW Champion Ram from Hinesville Stud from Delegate, both measuring over 21 micron making $14,000. The sale averaged $4,675. A pleasing stat to come out of the sale was the number of rams offered broader than 20 micron (18) and all sold. The Glendonald Stud from Victoria sold 3 rams at 22, 23.8 and 25 micron to average $5,830 with 21kg (46 pnd) of wool from the 23.8 micron ram who, according to all the good judges, had a magnificent skin. This move to broader rams is encouraging as the over supply of fine wool < 19 micron is still hurting that sector of the market and for too long the market place has been crying out for more medium wool sheep. Maybe this is the start of it.

Ag Concepts Fwd Prices as at 28 August 2015

Main Buyers (This Week)