WEEKLY MARKET REPORT

Week Ending 9^th September, 2011

Northern Micron Indices Comparison: Source of information: AWEX

MARKET RECOVERS SOME LOST GROUND

Our prediction of a dearer market rang true as the past two weeks of consolidation led to a solid basis for a reasonable volume of wool to be traded. Most exporters booked up wool late last week and early this week and this, coupled with the falling exchange rate, augured well for a rise in the market. The market was off to a flying start on Wednesday as most indicators recorded 10 to 35 cent gains. The finer indicators (finer than 17.5) failed to fire to finish in buyers’ favour. The rises weren’t as pronounced on the final day of trading with gains of up to 10 cents. Most notable was the shrinking discounts for VM and colour and cott. Some of our fleece lots with colour and soft cott made up to 20 cents clean more than same micron lots with the only fault being VM. One buyer we spoke to thought the discounts for VM in the 2 to 5 % range had halved with big volumes of these types being booked up over the past few days. This week’s rising market saw us sell every lot, our first 100% clearance. 57% of our fleece lots made over 1000 cents with the average greasy price for fleece wool in Sydney this week at 1079 c/kg. This compares favourably with Melbourne - their fleece price was 896 cents - despite the Sydney offering just 0.9 micron finer than Melbourne’s selection. The highlight was the 25 micron indicator in Melbourne climbing a massive 82 cents.

The good gains weren’t confined to the fleece room as skirtings pushed higher on both days. By the close of trade all types and VM levels looked to be 30 to 40 cents up on last week. We had three lots that made over 1000 cents with two lots of Nyngan BKN averaging 610 cents with LKS from Yeoval making 513 cents - a great result! Cardings also pushed higher as the MCI lifted by 26 cents. Locks and Crutchings added 20 to 30 cents while Stains performed the best in this sector with 35 to 40 cent rises. Crossbreds took a breather this week and remained virtually unchanged bar the finer end with 25s mentioned earlier and 26 microns posting a 25 cent rise.

The cycle of upward prices looks to have started again as the EMI added 24 cents to sit at 1294 cents. This rise follows on from the poor start to the resumption of sales after the July recess. The opening two weeks saw the EMI fall 98 cents with the next three sales (including this week) claw back 31 cents. Next week’s action moves to Newcastle as they host their first sale of this season. 15,000 bales are rostered with a sprinkling of superfine clips on offer to test demand for this sector of the market. Growers should notice a big difference in prices as some of these types have nearly doubled in value in 12 months. Our new wool store is nearing completion as the shed is practically finished and the office is being built at a rapid rate. Photos are on the website to check progress of construction.     

AgRisk FDIC Indicative Quotes 09/09/11

MAJOR AUCTION BUYERS (Bales)

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

Eastern 1294 cents (é24) compared with 02/09/11                                                1.0598 ê 0.0099 compared with 02/09/11

Northern Market Indicators (AUD cents/kg clean)

Northern 1344 cents (é25) compared with 02/09/11