WEEKLY MARKET REPORT

Week Ending 5^th September, 2014

AWEX Northern Micron Indices Comparison

A STRONG MARKET … MORE TO COME??

Last Thursday’s small recovery gave us hope that the wool market had bottomed out and signals of an improving market were in place. This came to fruition this week as a steady rise on the opening day led to higher increases on Thursday as the AWEX EMI posted a 23 cent rise for the sale (now up to 1025) - the best weekly rise for 5 months. The two centres on the Eastern Seaboard averaged 23 cent jumps while Fremantle was the best performing centre with a 39 cent climb to 1081 cents as their individual indicators put on 40 to 50 cents.  Sydney’s rises weren’t that pronounced - up by 20 to 40 cents while down south, most gains were in the 25 to 50 cent range.

It looked as though nothing missed out on this rise. As we have said in past reports, and is nearly always the case, lower spec off types played catch up to their more sought after better style counterparts recording good rises to close the price gap significantly. We had a lot with 5% vm just 15 cents off the indicator (normally a discount of 50 to 60 cents) and two other lots over with 2% vm within 5 cents of an FNF type, one with a mid-break over 65. A few other fleece lots that fitted nicely into exporters orders made up to 25 cents over the indicator. Just 8% of all fleece wool was passed in, the best clearance rate for this sector in months.

Skirtings also benefited from the increased buyer activity but not to the extent of the fleece room. Both days saw subtle rises to see all types and descriptions lift by 15 to 20 cents with 94% cleared to the trade. Cardings saw prices improve to the tune of 5 to 10 cents with locks the main type to help the MCI rise by 10 cents (in Sydney) to 779. All three centres are now within 10 cents of each other, 769 to 779 in this sector. Crossbreds improved with a 5 cent gain in Sydney and Melbourne’s selection 10 to 15 cents higher.

The market staged a good recovery with good volumes of business written; the AUD$ lower; national quantities smaller than usual; and the release of AWTA testing data for August all playing a factor in the rising prices. It could also be a case of de-ja-vu as this week 12 months ago the EMI rocketed up by 64 cents, this following a 52 cent rise the previous sale – a 116 cents, 10.5% jump in 2 sales! No such luck this year but a 20 odd cent lift is better than none. It is interesting to note the second and third weeks of September last year saw the EMI lose 56 cents, something that won’t happen this year I’m sure. The AWTA figures released for August show a decrease in lots tested (2%), but a 3% rise in bales and weights compared to last year. When looking at the progressive totals we are back 5.6% on lots tested and a 1.1% drop in bales and weights to last year - something that exporters would be well aware of. Only 37,000 bales are catalogued next week. We should see another good result for the grower.

Ag Concepts Fwd Prices at 5 September 2014

Main Buyers (This Week)

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

1025 cents é 23 cents compared with 29/08/2014                0.9347 é 0.0010 compared with 29/08/2014        

Northern Market Indicators (AUD cents/kg clean)

1042 cents é 21 cents compared with 29/08/2014