Weekly Market Reports


31 May 2013

admin Macwool - Friday, May 31, 2013

WEEKLY MARKET REPORT

Week Ending 31st May, 2013

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

31/05/2013

Last Week

24/05/2013

Change

Last Year

01/06/2012

Yearly Change

17

1296n

1315n

-19

1499n

-203

18

1203

1237

-34

1347

-144

19

1173

1206

-33

1294

-121

20

1141

1162

-21

1268

-127

21

1138

1147

-9

1265

-127

22

1136n

1146n

-10

1247

-111

26

816n

809n

+7

-

-

28

630

615

+15

638

-8

30

582

566

+16

580

+2

32

483n

468n

+15

485n

-2

MC

780

758

+22

629

+151

A MAJOR BUYER GONE ….

Unfortunately, as our heading pre-empted last week, there was some uncertainty as to the market’s direction after a softer tone last Thursday. This cheaper trend continued into this week as an opening day slip in prices was followed by a steadier market on Thursday to see the EMI fall 6 cents to 1032. When looking at the individual micron indicators, the falls seem much heavier as 17 to 20 microns fell 20 to 35 cents with 21s, 22 and finer than 17 gave up 10 cents. A good increase in Room 2 prices (skirtings, cardings and XBs) saved the EMI from falling any further than it did as all types across all micron ranges are now included in the formula that works out the EMI and individual centre micron price guides. Even with the market in retreat we still had some good results in the fleece room. One particular grower with two lots of 22 micron (one at 42 nkt and the tender line at 31 nkt) saw the tender wool make 1179 cents clean, virtually the same as an 18.5 micron type and 45 cents better than his sound line. Upon closer inspection of our fleece catalogue, up to 20 lots looked from 10 to 40 cents clean higher than where the indicators finished, surprising us when the market report showed a negative trend.

In contrast to the fleece room, all lots in the 2nd room continued to go from strength to strength. All descriptions of skirtings finished 10 to 20 cents higher with most emphasis on lots with 8% VM and higher. Cardings recorded good rises in all three centres with a 22 cent jump in Sydney to 780 cents - a level not too far below the lofty heights of 2011. Locks were the stand-out performers gaining 25 to 35 cents, while stains rose 15 cents and crutchings up by 15 to 25 cents. Crossbreds kept pace with the other sectors in room 2 as finer types, <26 micron were 5 to 10 dearer, while the broader indicators of 28 to 32 put on 15 cents for the week.

The cautious approach at the end of last week kept going into this week as the Chinese tried to guess where the A$ would settle. This turned out to be harder than everyone had anticipated as it moved freely from just below 97 cents to be only just above 95 early on Thursday morning and today back to almost 97 cents! Also putting a cat amongst the pigeons was the announcement on Monday that it would be the finish of Dalgety Wool Exports and Viterra Wool effective from June 30th. More on this later. The shrinking weekly quantities would also be playing on the minds of the Chinese as the past five sales have only averaged 35,000 nationally and the next three back to 27,000. Sydney will hold its first one day sale in 5 years next week with only 8,200 bales rostered. This follows on Fremantle conducting three one day sales in a row and next week no sale.

A media report released on Monday morning confirmed weekend rumours of Viterra and Dalgety Wool Exports shutting up shop by June 30th. Just last week Landmark, now owned by US agricultural retailer Agrium, announced a successful take-over bid of Viterra’s  Australian agriproducts, grain handling  and wool business from Swiss based commodity trading giant Glencore. Viterra was previously buying wool under the ABB name (Aust. Barley Board) when Glencore first acquired it over 6 years ago. Since 2009 they had been the number 1 buyer in Australia, securing 11 to 14% of the national clip for mills across the world. Dalgety Wool Exports, trading under the Landmark banner, took over the flagging Elders Wool International business in 2011 and have been buying about 2% of the clip since then and with the impending take over of Viterra by Landmark talk was rife on the show-floor as to what might happen. A sad day for the wool-buying fraternity.

 

Ag Concepts Fwd Price Trades W/E 31 May, 2013

MPG

Maturity

Low

High

21

21-Aug-13

1115

1115

21

18-Sep-13

1110

1110

21

23-Oct-13

1100

1100

 

 

1

Techwool

3745

2

Fox & Lillie

2964

3

Lempriere (Aust)

2649

4

Australian Merino Exp.

1875

5

Modiano (Aust)

1838

6

Chinatex

1797

7

Queensland Cotton

1655

8

Tianyu Wool Pty Ltd

1536

9

PJ Morris

1525

 

Eastern Market Indicators (AUD cents/kg clean)                                    AUD/USD Currency Exchange

1032 cents ê  6 cents compared with 24/05/2013                                  0.9681 é 0.0033 compared with 24/05/2013

 

Northern Market Indicators (AUD cents/kg clean)

1048 cents ê  6 cents compared with 24/05/2013

 

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