WEEKLY MARKET REPORT

 Week Ending 9^th August, 2013

AWEX Northern Micron Indices Comparison

 OFF TO A GOOD START

Wool sales re-commenced this week following the usual three week winter recess. From most reports the buyers took a good break away from the wool business to attend their AGMs at various exotic locations both here and overseas, to going on well deserved holidays, or, as one buyer put it, ‘did absolutely nothing’. This week’s sale wasn’t the first held. Auctions Plus (who run the Wooltrade Offer board and a small electronic sale every Tuesday) held a sale last Thursday offering 6,100 bales. 15 buyers bought wool, with the top 3 securing 50% of the offering, with 30% being passed-in. Despite the large pass-in rate, the market was solid with skirtings, oddments and crossbreds rock solid and most fleece types on par or just either side of the quotes from Sale 02.

The opening AWEX sale saw a national catalogue of 45,000 bales up for sale - not an overly large offering considering the three week recess in which to collect wool for this sale. Reports of a good market stemming from last week’s results came to fruition as the EMI added 10 cents to sit at 1017 cents, 22 cents higher than 12 months ago. Fine types benefitted the most as 19 micron and finer gained 12 to 45 cents despite softening by 5 to 15 cents on Thursday due to a style adjustment. The medium indicators had minimal shifts either side of Sale 02 quotes with 23s in Melbourne slipping 20 cents to now reflect a more typical fine-to-broad price relationship.

Skirtings re-commenced selling with a bang as all types, regardless of VM and style, posted gains of 30 to 45 cents. Cardings continued to march to record levels and the 11 and 16 cent rises in Sydney and Fremantle to 836 and 830 cents respectively, set new records while Melbourne need only add 8 cents to join the other two centres in new lofty levels for cardings. All types and descriptions looked 5 to 20 cents better with LKS from Wellington, Quambone and Merriwa making 595,573 and 565 cents respectively! Crossbreds rose as well with all indicators up to 10 cents dearer.

Certainly a solid -but not spectacular - start to the run of sales through to December. One and all will be keeping a close watch on proceedings as we get into the Spring selling season and the Newcastle wools are spread more evenly through the sales. There will be no build up for every sale that was held there (as with previous seasons) as the subdued demand not coping with big volumes of the same types. Hopefully the lift in the finer indicators is a sign of things to come. The favourable move in the exchange rate to around 90 cents, and in fact below 89 at one point, would have been a help to the market. It looked as if the A$ was stuck at 92/93 cents for weeks, until better economic data from the USA last week strengthened their $. The three week gap in sales also kept mills keen to re-commence buying. One thing for sure is volumes will play a critical part in price direction. Fremantle will hold a 1 day sale next week as part of the 37,500 national catalogue - this after a three week recess! We offer 2200 bales on Wednesday, hopefully in a dearer market.             

Fwd. Price Trades W/E 12 July, 2013

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

1017 cents é 10 cents compared with 12/07/2013                                     0.9070 ê 0.0232 compared with 12/07/2013

Northern Market Indicators (AUD cents/kg clean)

1032 cents é 12 cents compared with 12/07/2013