Weekly Market Reports


26 August 2016

Friday, August 26, 2016

  WEEKLY MARKET REPORT

Week Ending 26th August, 2016

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S08/16

This Week

M08/16

Last Sale

S07/16

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1588n

1556

1583

+5

1491n

+97

18

1553

1529

1541

+12

1470

+83

19

1496

1486

1484

+12

1407

+89

20

1478

1464

1461

+17

1354

+124

21

1471

1458

1455n

+16

1346

+125

22

1452n

1450

1440n

+12

1340n

+112

26

1139n

1143n

1136n

+3

1085n

+54

28

777

787

753n

+24

914

-137

30

677

678

663n

+14

863

-186

MC

1053

1043

1046

+7

1073

-20

RAM SALES START WITH A BANG!! 

The market edged higher, Michael Phelps didn’t drown at the Olympics and Ram Sales are under way!! As most good judges thought the market added to last sale’s modest gain breaking through the 1300 cent barrier (an 11 cent rise to 1309) just 11 cents below the 12 month high of 1320 from Sale 01. Fine to medium types - 18 to 23s - went well posting 10 to 15 cent gains while the superfine microns <17.5 were in sellers’ favour as this recovery has most indicators just ahead or on a par with prices in early July.  In US$ terms the indicator fell 5 cents to 996 due to the A$ spending most of the week in the low 76s. Growers warmed to the lifting market as the clearance rate rose to 97.5% in the fleece room.

Skirtings also staged a recovery as rises of 10 to 20 cents were common with most emphasis on <3% VM - these prices now just below pre recess levels. Growers also took a liking to the renewed competition as just 12 bales were passed in from the Sydney offering of over 1900 bales. Cardings edged higher as the MCI lifted by 7 cents to 1053 as all types in this sector looked 5 to 10 cents better. Crossbreds also benefitted from the favourable exchange rate as gains were in the 5 to 25 cent range as these types are now 30 to 60 cents higher than early July.

The ram selling season is almost upon us as this week saw the National Ram Sale conducted here in Dubbo. The Supreme Ram was judged on Wednesday night from 4 outstanding sheep, one each from QLD, NSW, VIC and SA (2 super-fine and 2 medium sheep). The winner was the NSW ram from Peter & Jane Lette’s Conrayn Merino Stud at Berridale in the Snowy Mountains, southwest of Cooma. The 130kg ram at 17.8 micron was the supreme exhibit at Dubbo after winning the state title at the Royal Easter Show. The ram sale was highly successful with an average of $6540 from the 62 lots sold with a top price of $30,000 for a Towalba ram sold to Argentina. The South Americans dominated the top end of the sale as 2 other rams went to Argentina and 2 to Uruguay (these 5 rams averaging $19,800). Some notable stud averages were: Roseville Park $9625, Langdene $8165, Nerstane $14,500 (2 rams), Towalba $11,800, Glendonald $7335, Charinga $5,000, Alfoxton $6625 and Mount Ascot $4,500. A great success with anticipation of good ram sales to commence next week as we move into a bumper spring with very good commodity prices. Please don’t hesitate to contact your wool rep if any assistance is required with ram selections.

Next week has a national catalogue of 42,000 bales across the 3 centres with the opening designated super-fine sale of the season to be held in Sydney. If futures trading is a guide, market should be firm to dearer.

 

Ag Concepts Fwd Prices at 26 August 2016

Micron

Date

Low

High

21

21-Sep-16

1420

1420

21

26-Oct-16

1390

1430

28

14-Dec-16

750

750

19

22-Mar-17

1450

                1450              

 

                    Main Buyers (This Week)

1

Aust. Merino Exp

3192

2

Techwool

3174

3

Fox & Lillie

3117

4

Lempriere (Aust)

2615

5

Chinatex

2534

6

Modiano

1530

7

Tianyu Wool

1522

8

Kathaytex Aust

1499

9

PJ Morris

1481

  

Eastern Market Indicators (AUD cents/kg clean)

1309 cents é 11 cent compared with 19/08/2016

Northern Market Indicators (AUD cents/kg clean)

1333 cents é 13 cents compared with 19/08/2016

AUD/USD Currency Exchange

0.7611 ê 0.0102  compared with 19/08/2016

19 August 2016

Friday, August 19, 2016

WEEKLY MARKET REPORT

Week Ending 19th August, 2016

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S07/16

This Week

M07/16

Last Sale

S06/16

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1583

1542

1571

+12

1554n

+29

18

1541

1513

1533

+8

1537

+4

19

1484

1476

1492

-8

1466

+18

20

1461

1453

1471

-10

1420

+41

21

1455n

1446

1462

-7

1411

+44

22

1440n

1432

1446

-6

1394

+46

26

1136n

1133n

1123n

+13

1085n

+51

28

753n

770

738

+15

927

-174

30

663n

674

-

-

868

-205

MC

1046

1046

1041n

+5

1067

-19

 

MARKET EDGES HIGHER AS VOLUMES DIMINISH!

 

Buyers were still unsure as to how the market might play out early in the week as the national catalogue fell to 41,000 bales and the A$ kept moving either side of 77 cents. The market did start off sluggishly - modest falls of up to 5 cents across all microns was the result but the market did firm up right at the end of the opening day. This positive tone was carried into the final day’s offering with most emphasis on 18.5 and finer as broader types drifted lower. By week’s end the market had split in two, 18 and finer posting a 10 to 15 cent increase while 19 and broader lost 5 to 10. The aggressive buying pattern for Spinners/Best style types continued on as they commanded premiums of up to 100 cents as good spec medium types looked to be up to 20 cents better than their micron indicators. The overall gains were the barest minimum for both EMIs up by just 1 cent to 1298 for the AWEX indicator and 1001 in US cent terms.

Skirtings couldn’t keep pace with their fleece counterparts as all types across the full micron and VM spectrum were being quoted 10 to 20 cents cheaper. Crossbred looked to be the best performing sector of the sale as most microns added 15 to 25 cents with the outstanding performer being 32 microns in Melbourne, up a whopping 59 cents!! Cardings clawed back some of last week’s losses after a final day rally of up to 10 cents for most types.

Out of the sale room there was plenty of chatter regarding one of the largest wool buyers and Landmark. A report in last Wednesday’s Financial Review had Lempriere Australia in due diligence to buy Landmark for $1.2 billion from its US based parent company Agrium.  Lempriere is a 5th generation wool buying Co. with its origins dating back to the late 1800s in France but forged a partnership with Chinese textile giant Shandong RuYi in 2012 following the purchase of Cubbie Station at Dirranbandi for $240 m. Both parties declined to comment on the speculation. Landmark’s revenue to last December was $2.3 billion, 3rd only to Graincorp and Nufarm for agricultural companies in Australia. Ruralco was also mentioned as a possible contender for the retail business of Landmark.

Still with Landmark, but is fact, is their purchase of rival Victorian woolbroker, Arcadian Wool. It has secured the remaining 50% of the business after founding the company in 1985 with an original 40% that was built up to 47% by 2013.  This now gives Landmark 19% of the wool sold through Melbourne, some 160,000 bales/year. With just the 2 Eastern seaboard centres in action next week, with only 31,000 bales on offer, anything less than a firm market would be akin to Michael Phelps drowning!!  

Ag Concepts Fwd Prices at 19 August 2016

Micron

Date

Low

High

21

14-Sep-16

1420

1420

19

12-Oct-16

1450

1450

21

26-Oct-16

1385

1385

21

22-Feb-17

1355

1355

 

Main Buyers (This Week) 

1

Fox & Lillie

4641

2

Techwool

4392

3

Chinatex

4285

4

PJ Morris

3362

5

Aust. Merino Exp

3118

6

Lempriere (Aust)

2865

7

Tianyu Wool

2374

8

Modiano

1824

9

Kathaytex Aust

1312

  

Eastern Market Indicators (AUD cents/kg clean)

1298 cents é 1 cent compared with 12/08/2016

Northern Market Indicators (AUD cents/kg clean)

1320 cents ê 1 cents compared with 12/08/2016

AUD/USD Currency Exchange

0.7713 é 0.0004  compared with 12/08/2016

12 August 2016

Friday, August 12, 2016

WEEKLY MARKET REPORT

Week Ending 12th August, 2016

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S06/16

This Week

M06/16

Last Sale

S02/16

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1571

1543

1577

-6

1497

+74

18

1533

1506

1543

-10

1472

+61

19

1492

1479

1501

-9

1403

+89

20

1471

1465

1479

-8

1368

+103

21

1462

1461

1469

-7

1359

+103

22

1446

1437

1456n

-10

1336

+110

26

1123n

1131n

1103n

+20

1059

+164

28

738

760

755

-17

912

-174

32

520n

525n

515n

+5

741

-221

MC

1041n

1043

1084

-43

1041

0

CARDINGS WEIGH HEAVY ON THE MARKET

 

Sales resumed this week after what seemed a long 3 week recess!!  Talk of a 50,000+ bale catalogue rang true as the wet weather at the end of June hampered receivals for Sale 1 and 2 pushing wool back to this week’s sale - this being the case not only for us but most brokers up and down the Eastern seaboard. The national offering of 52,000 bales (31,000 - 60% fleece wool) was  the biggest since January and the largest post-recess opening sale in 5 years - this being enough to see the exporters approach the sale with caution. Sydney opened its sale with most fleece types in sellers’ favour as Melbourne and Fremantle opened on a cheaper note. This falling trend filtered through to Sydney on the 2nd day as all 3 centres lost more ground.  By week’s end 17.5 and finer only lost up to 5 cents with 18 to 22s giving up 10 cents as broader types lost 15 cents. The better style types with good specs held their ground and, in some cases, were up to 25 cents better than their indicators as the part tender, burry types lost up to 30 cents to see similar wool depending on good or bad specs up to a 100 cent price gap.

Skirtings followed a similar pattern to the fleece room as the better spec lots went okay with the burrier/short types losing ground. Lots <5% VM held their ground as anything with more VM fell by 25 to 30 cents. Crossbreds had a mixed sale moving in all directions. Finer microns <25 were 15 cents down, 26 and 30 micron and broader lifted by up to 20 cents while 28s lost 20 cents. Cardings were the worst hit sector as big losses on the opening day were followed by a firming market on Thursday. Each regional MCI lost between 30 to 45 cents with locks giving up 60 cents, stains back by 40 cents and inferior CRT losing 20 cents.

The 14 cent fall in the EMI saw the market slip below 1300 cents to 1297 but, in US$ terms, the shift was the barest minimum of 1 cent, up to 1000, this due to the rise in the exchange rate (now over 77 cents) which at one stage during the recess was just above 74 cents. Buyers were left somewhat confused by the large offering - the biggest factor for the downward pressure - yet a drop in testing figures for July of 10% less when compared to July 12 months ago. Not that hard to work out, prolonged wet weather in June has delayed shearing and wool receivals by 2/3 weeks making Sale 1 and 2 smaller than the previous year by 10 % thus pushing late wool into this week’s sale. Had everything run to schedule, this sale would have been around 45,000 bales and testing figures would have been 15 to 20% less in July than 12 months ago. The power of a major Chinese indent buyer was evident this week as he purchased 20% of the fleece on offer nationally. This buying intensity went till the very last lot in Thursday as the fleece market firmed up. The price gap between microns is close to an all time low as some lower spec types finer than 17 micron are struggling to match prices of good 20 to 22 micron wools. In fact the gap from 21 down to 17 micron is just 110 cents, making medium wool sheep returns/head miles in front of their fine-wool cousins!! Next sale will see a national catalogue of 42,000 bales. We sell first up on Wednesday to a firm/unchanged market we hope.

Main Buyers (This Week) 

1

Lempriere (Aust)

6453

2

Chinatex

6329

3

Techwool

5441

4

Aust. Merino Exp

4409

5

Fox & Lillie

3765

6

Modiano

3357

7

PJ Morris

3269

8

Tianyu Wool

2137

9

G Schneider (Aust)

884

  

Eastern Market Indicators (AUD cents/kg clean)

1297 cents ê 14 cent compared with 15/07/2016

Northern Market Indicators (AUD cents/kg clean)

1321 cents ê 12 cents compared with 15/07/2016

AUD/USD Currency Exchange

0.7709 é 0.0093  compared with 15/07/2016