WEEKLY MARKET REPORT

Week Ending 6^th December, 2013

AWEX Northern Micron Indices Comparison

STILL GOING

Another good wool sale as the EMI added 17 cents to its value - an identical rise to the previous week. The currency, which is just sitting above 90 cents, is certainly giving exporters enough enticement to step in and buy.  The EMI reached a 19 month high on Wednesday of 1145 before slipping back a cent on Thursday. In US cent terms, the market rose 5 cents, to recover last sale’s 4 cent loss to now sit at 1035.

This week’s sale commenced in Melbourne on Tuesday with the last substantial super-fine offering of the year as the market recorded good rises. As all three centres came on line on Wednesday all microns rose by double digits, except finer types under 17.  Thursday saw the heat come out of the market as most indicators in Melbourne and 19.5 and broader in Sydney lost up to 10 cents.  By week’s end rises were in the 20 to 45 cent range for 17 to 21s with 22s up by 7 and finer types in sellers’ favour in Sydney, but 20 dearer in Melbourne helped along by the Launceston selection early in the week. For the second sale in a row, Fremantle was the best performing centre - their indicator up by 21 cents. Also of note was the gap between the high mid-break lots and their low mid-break counterparts, with the former giving up 20 to 30 cents on the final day.

Skirtings followed the pattern of the fleece room as solid gains of 20 cents for all microns out to 8% VM was the result of two days of spirited bidding. This sector of the market is benefitting from great demand especially low VM fine types. Two neighbours from Orange averaged 805 cents for their “BKN” and 704 for “BLS”. Burrier skirtings aren’t being neglected either as Cobar and Warren ‘BKN’ made mid to high 500 cents, helping boost clip averages. Cardings kept their head above water as all types and descriptions edged higher to add 2 cents to the MCI, now at 812 cents. Crossbreds also had a steady sale as rises in Melbourne of up to 10 cents were negated by most indicators in buyers’ favour in Sydney, with the southern centres volume of crossbreds at 27% of their offering this week.

We are now well and truly at the pointy end of the year as just one sale is left before the three week Christmas recess. Next week will see the biggest national offering so far this season (57,000 bales), the largest since April, a sharp rise of 9,000 bales in only a week due to a rising market and a low and stable exchange rate. With the market showing some signs of weakness on Thursday, we may be holding our breath as to where it will finish next week. A positive signal that AWI is spending your 2% wool tax wisely is that a Russian delegation has made its way down under on a fact finding tour this week. This follows on from an Aussie trip to Russia 18 months ago, hopefully leading to them re-entering the market, sooner rather than later and giving the Chinese a run for their money.

Ag Concepts Fwd Prices at 6 December

Main Buyers (This Week)

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

1144 cents é 17 cents compared with 29/11/2013               0.9044 ê 0.0091 compared with 29/11/2013

Northern Market Indicators (AUD cents/kg clean)

1171 cents é 19 cents compared with 29/11/2013