WEEKLY MARKET REPORT

Week Ending 4^th November, 2011

Northern Micron Indices Comparison: Source of information: AWEX

A GOOD RISE BUT MORE TO COME??

Back from the Shaky Isles refreshed and rejuvenated! With the market’s good rise in my absence Don’s first question was “when’s your next week off?’ It was great to see last week’s price surge with prices more or less consolidated in the sales held this week - despite the distraction of the races in Melbourne. There was no buyer hang-over on Wednesday as rises stretched from 1 cent to 43 cents in Sydney and up to 30 cents in Melbourne with both regional indicators adding 13 cents to their previous sales quotes. The biggest increases were in the broader end as 22 and 23 microns posted 30 to 43 cent rises. 18.5 to 21 micron gained 10 to 20 cents with the sub 18 micron lots in sellers’ favour by up to 7 cents. The heat came out of the market on Thursday as most indicators gave up some of the previous day’s gains with the emphasis on 21 to 23s, back 15 to 25 cents. By the final lot on Thursday only 21s were in the negative (1 cent) with all other indicators recording single digit rises except 18.5, 20, 22 and 23s finishing 15 to 20 higher. As is the case when the market moves, discounts for VM, colour and cott shrink with some 2% VM lots costing the buyer more than FNF types on the odd lot.

Unlike the subdued fleece sector skirtings had a repeat of last week’s rises. The largest rises occurred in the low VM types with 5% and freer adding 50 to 60 cents to last week’s quotes with finer microns more keenly sought after. Heavier VM lots were not forgotten as 8% and greater jumped 30 cents. All these descriptions found good support on Thursday and remained fully firm. Cardings snuck ahead to add just 2 cents to the MCI, now at 725 cents. Finer locks (under 18 micron) added 10 to 20 cents with all others tending sellers’ favour. Crutchings remained fully firm with stains ending the sale slightly dearer on a limited offering. Crossbreds trended cheaper for the week as 28s lost 15 cents, 32s down 7 cents with all others unchanged. An increasing volume of Crossbred types could be the reason for the fall in some of these categories as 25% of the total offering in Sydney were XBs. On Wednesday, 28 and 30 micron had the most quantity of any micron. The % of XB wool has steadily been increasing as weekly volumes decrease in Sydney as this week’s offering of just 8,500 bales (smallest in 12 months) is evidence of no jump in volume of wool coming through. As explained in last week’s report, we are slowly coming back to last year’s figures as the year on year offerings are now just 22,000 bales ahead of last season. This will creep even closer as this season’s shearings are well ahead of last year’s rain affected season. An increase in national offerings shouldn’t be enough to spook buyers as futures point to a good market next week.                

                                                                   Agrisk FDIC Indicative Quotes 28/10/2011

MAJOR AUCTION BUYERS (Bales)

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

                Eastern 1224 cents (é 9) compared with 28/10/11                         1.0242 ê 0.0248 compared with 28/10/11

                Northern Market Indicators (AUD cents/kg clean)

                Northern 1267 cents (é10) compared with 28/10/11