Weekly Market Reports


30 September 2016

Friday, September 30, 2016

WEEKLY MARKET REPORT

Week Ending 30th September, 2016

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S13/16

This Week

M13/16

Last Sale

S12/16

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1613

1581

1577

+36

1464

+149

18

1596

1561

1549

+47

1428

+168

19

1527

1498

1491

+36

1346

+181

20

1405

1397

1410

-5

1278

+127

21

1393

1372

1395

-2

1265

+128

22

1364n

1357

1386n

-22

1257n

+107

26

1123n

1149n

1145n

-22

1138n

-15

28

770

770

748

+22

910

-140

30

603

606

585

+18

875

-272

MC

1063n

1043

1062n

+1

1099

-36

FINER WOOLS IN HOT DEMAND

 

The theme of this week’s market was “steady” - a steady market and a steady $ (not more than .75 cent shift). The AWEX EMI had minimal movement, just a 3 cent rise to 1290 cents. In US terms the rise was slightly more, 9 cents up to 993. The superior super-fine selection  saw more competition for 19s and finer to recoup previous sales’ losses, a general rise of 30 to 50 cents and up to 100 cents on some of the superior lots. 19.5 to 21 micron barely shifted either side of the indicators with 22 and broader giving up 25 cents. The market looks to be back in some sort of order as the gap between 19 and 21s is out to 130 cents as it was in May/June. The closest it was in late August was just 25 cents.

Skirting buyers liked what they saw as spirited bidding saw <18 micron up to 3% VM 25 to 30 cents higher with the burrier types 15 to 20 cents better with 19 micron and broader tending in sellers’ favour regardless of VM. The crossbred market split into 2 as <26 microns lost 10 to 20 cents with the 28s and broader reversed their recent losses adding 15 to 25 cents to their values. The carding sector had a steady sale, the MCI up by 1 cent to 1063 as the opening day’s losses were corrected to see all types just in sellers’ favour.

At the Nanjing Wool Conference held at Wuxi, China, last Saturday and Sunday most of the discussion revolved around the 7% fall in production last year and the predicted small recovery in production this year. Stocks all the way along the pipeline are at low levels. This includes unprocessed wool, tops, yarn and fabric. There is far more emphasis on doing the business “just in time” meaning that it is all hand to mouth and not buying the product unless it is already paid for at the other end .This can be seen in the relatively stable market over the last 12 months. The quality of wool as a fibre was spoken about often, recognising that to get wool’s best value it needs to be used in top end products. Most of the processors expressed that it had been a tough year however, considering that China’s GDP has fallen from over 11% to 6%, this may have as much to do with trading conditions as anything else. Australian exporters that we spoke to said that they could not see much downside to the market in the short to medium future saying demand is likely to continue to outstrip supply so woolgrowers are in a good place at the moment.

A few local ram sales were held this week in between the showers. Allendale at Wellington gained a top price of $4,400 to average $1,735 to clear 98%. Dunbogan at Elong Elong sold 50 rams to average $1,600 with a top price of $3,000 twice. Next week sees 39,000 bales on offer - hopefully the positive mood sticks. Go Cronulla & the Swannies!!!

 

Main Buyers (This Week)

1

Techwool

5241

2

Aust. Merino Exp

3730

3

Fox & Lillie

3100

4

PJ Morris

2579

5

Lempriere (Aust)

2204

6

Tianyu Wool

1883

7

Michell Aust

955

8

Zhong Long Int.

914

9

United Wool

791

 

Eastern Market Indicators (AUD cents/kg clean)

1290 cents é 3 cents compared with 23/09/2016

Northern Market Indicators (AUD cents/kg clean)

1333 cents é 17 cents compared with 23/09/2016

AUD/USD Currency Exchange

0.7698 é 0.0048  compared with 23/09/2016

23 September 2016

Friday, September 23, 2016

WEEKLY MARKET REPORT

Week Ending 23rd September, 2016

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S12/16

This Week

M12/16

Last Sale

S11/16

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1577

1562

1605

-28

1462

+115

18

1549

1542

1580

-31

1437

+112

19

1491

1484

1517

-26

1356

+135

20

1410

1403

1452

-42

1294

+116

21

1395

1391

1438

-43

1278

+117

22

1386n

1386n

1416n

-30

1269n

+117

26

1145n

1145

1175n

-30

1145n

0

28

748

748

788

-40

934

-186

30

585

585

625

-40

886

-299

MC

1062n

1062n

1053

+9

1097

-35

LACK OF SUPPLY FORCES MARKET DOWN???

 

Once again the direction of the market was nearly impossible to pick as outside influences dictated play. The market suffered from a rebound in the exchange rate of almost 2 cents, this being enough to see buyers pull back on their prices. The AWEX EMI fell sharply, a 24 cent fall to 1287 this, the largest weekly movement since early June. Also on the radar was the question of quantity, not too much, but not enough!! Falls were across the board as <18.5 gave up 20 to 30 cents but the better spec types in these micron ranges (even up to 2% VM) made 15 to 30 cents higher than their indicators. The medium to broad microns (19 to 24) recorded the largest falls giving up 25 to 45 cents.

Skirtings looked to be less affected as losses ranged from 5 to 15 cents depending on VM and style. Cardings bucked the falling trend of all other sectors as the MCI added 9 cents to its value (now 1062) as most types were 5 to 15 cents to the good. Crossbreds undid their good work over the past month by shedding 30 to 40 cents across the board.

For buyers to say that a shortage of wool is now a concern (and a factor in the falling market) is quite staggering. There are always plenty of grumblings when volumes balloon out by 10/15%, this usually following a sharp rise in the market. This sales roster was published as 42,000 last Friday to a final offering of 39,590 a fall of just 5.5%!!  The passed-in rate doubled to 13%. This, coupled with withdrawn wool, saw only 34,300 bales cleared to the trade. If they’re worried about securing wool from a dwindling quantity there is only one thing to do, bid up or miss out!! Year to date quantities show more wool offered this season than last by 24,000 bales, an increase of 7%. Their thinking hard to comprehend at the best of times!!

Ram sales continue on despite the rain threatening to wash some out. A few results from local studs: Parkdale SRS stud towards Collie cleared 100% for a top of $3,000 to average $1,420; Yeoval stud Gullengamble cleared 92% of the 170 rams offered to average $1,915 with a top price of $6,750; and Langdene from Dunedoo cleared 98% of their offering with a top of $12,000 to average $3,150.

Next week sees the 2nd designated super-fine sale of the season and, if this week is any guide, growers will be nervous about the outcome as the national catalogue winds back to 35,000 bales. Wet weather is playing its part in slowing wool receivals to a walk.

Ag Concepts Fwd Prices at 23 September 2016

Micron

Date

Low

High

21

21-Sep-16

1410

1410

21

8-Mar-17

1377

1377

 

Main Buyers (This Week)

                    

1

Fox & Lillie

4285

2

Lempriere (Aust)

3555

3

Techwool

3308

4

PJ Morris

2851

5

Aust. Merino Exp

2439

6

Chinatex

2340

7

Tianyu Wool

2262

8

Michell Aust

1163

9

United Wool

1085

  

Eastern Market Indicators (AUD cents/kg clean)

1287 cents ê 24 cents compared with 16/09/2016

Northern Market Indicators (AUD cents/kg clean)

1316 cents ê 24 cents compared with 16/09/2016

AUD/USD Currency Exchange

0.7650 é 0.0186  compared with 16/09/2016

16 September 2016

Friday, September 16, 2016

WEEKLY MARKET REPORT

Week Ending 16th September, 2016

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S11/16

This Week

M11/16

Last Sale

S10/16

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1605

1579

1593

+12

1474

+131

18

1580

1555

1561

+19

1459

+121

19

1517

1511

1498

+19

1393

+124

20

1452

1440

1460

-8

1336

+116

21

1438

1426

1445

-7

1320

+118

22

1416n

1411

1436n

-20

1304n

+112

26

1175n

1169n

1167n

+8

1136n

+39

28

788

774

771

+17

948

-160

30

625

632n

619n

+6

897

-272

MC

1053

1038

1049

+4

1089

-36

MARKET RISES BUT UNCERTAINTY AHEAD

Outside influences played havoc with this week’s market as it seemed to move in all directions. By week’s end the market had posted a 6 cent rise for the EMI to 1311. In US$ terms the shift was much more dramatic - down 24 cents to 979 - this due to the sudden fall in the exchange rate from a high of 77.2 last Thursday to under 74.5 last night. The market opened with a bang as finer microns led the charge only to lose ground in the final session despite the currency staying around 74.5 cents except for Wednesday night, peaking at 76.20. 19 micron and finer did finish in positive territory, up by 10 to 25 cents while 20 and broader fell 10 to 20 cents.

Skirtings also benefitted from the swings in the currency. All types and descriptions regardless of VM were pushed up by 25 to 30 cents as bidding was ramped up. Crossbreds followed the pattern of merino fleece types but still ended in sellers’ favour by 5 to 15 cents.  The carding sector had the quietest sale as price movements were marginal, up to 5 cents higher than the previous week.

A wild week for global stocks as the Dow dropped by 400 points last Friday night following comments that interest rates in the US are more than likely on the way up sooner rather than later. This sent the US$ skyrocketing and most other currencies falling as the trend of the big movements on global markets kept going all week putting a high degree of uncertainty and apprehension for the next few weeks for all commodities including wool.

Ram sales and bull sales continue on and reading “The Land” lots of headlines contain the word “Record” - a reflection of the increased demand and great season. A few results from the past week include:  Haddon Rig, celebrating 100 years of Falkiner family guardianship of this historic stud, had a total clearance for a top price of $11,000 to average $2,650, up $300 on last year’s average; Merryville topped out at $5,500 to average $1,885 and the record set by Kerin Poll last week was broken by Yarrawonga at Harden clearing all 200 rams to average $3,800 grossing an incredible $760,000. On the meat-sheep side Ashbank at Dubbo cleared all Poll Dorset and White Suffolk rams to average $1,700 with a top of $2,600, while Narranmore at Elong sold 100% to top at $3,300 to average $1,370. 42,000 bales are on offer next week with Macwool offering on Thursday. It’s hard to guess the market’s direction.

Ag Concepts Fwd Prices at 16 September 2016

Micron

Date

Low

High

Micron

Date

Low

High

21

26-Oct-16

1450

1450

21

11-Jan-17

1400

1400

19

23-Nov-16

1500

1500

21

10-May-17

1400

1400

 

Main Buyers (This Week) 

1

Techwool

5251

2

Lempriere (Aust)

3618

3

Fox & Lillie

3225

4

Chinatex

3204

5

PJ Morris

2573

6

Tianyu Wool

2359

7

Aust. Merino Exp

2537

8

Modiano

1606

9

New England Wool

607

 

Eastern Market Indicators (AUD cents/kg clean)

1311 cents é 6 cent compared with 9/09/2016

Northern Market Indicators (AUD cents/kg clean)

1340 cents é 10 cents compared with 9/09/2016

AUD/USD Currency Exchange

0.7464 ê 0.0216  compared with 9/09/2016

9 September 2016

Friday, September 09, 2016

WEEKLY MARKET REPORT

Week Ending 9th September, 2016

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S10/16

This Week

M10/16

Last Sale

S09/16

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1593

1568n

1599n

-6

1487n

+106

18

1561

1542

1567

-6

1459

+102

19

1498

1493

1513

-15

1404

+94

20

1460

1449

1490

-30

1348

+112

21

1445

1438

1480

-35

1331

+114

22

1436n

1428

1462n

-26

1322n

+114

26

1167n

1150n

1167n

0

1109n

+58

28

771

769

791

-20

940

-169

30

619n

626n

-

-

897

-278

MC

1049

1039

1056

-7

1085

-36

DOLLAR SPOILS THE PARTY!

The five days of rises in the wool market over the previous 2 weeks (25 cents) couldn’t be sustained as the benchmark EMI lost 15 cents to 1310 over the course of this week’s sale. In US$ terms the indicator added 7 cents to push back over 1000 to 1002 cents (a 15 month high) this due to the sharp rise in the exchange rate to 77.25 cents last night from a low of 74.80 only a fortnight ago. Losses were heaviest early in the sale only to find some limited support late in the final session. Finer indicators <18.5 finished the sale relatively unscathed - 5 to 10 cent falls - tempered by the 20 cent gain for spinners and best top-making style lots >40 nkt. The tender, broader and burrier types took the brunt of the falls - 19/19.5s lost 15 cents while 20 to 23s gave up 25 to 35 cents.

The softening tone filtered through to room 2 as skirtings also gave up some ground. The best style, low VM good length types were just in buyers’ favour as all others looked 15 to 20 cents cheaper than last sale. Crossbreds had mixed results as the finer indicators <26 were firm as the broader types >28 micron gave up as much as 20 to 50 cents for 32 and coarser. Cardings also gave up the gains of the past 3 sales as the 3 regional centres lost around 5 cents. Falls were restricted to the opening day as LKS and CRT lost 10 cents as carbonising - >3% VM - types most affected.

As reported a few weeks ago ram sales are under way and if Bull sales are any guide, studs should be looking forward to a successful outcome. Coddington Uardry Poll merinos at Cumnock cleared 96% for a top of $8,500 to average $2,160. Their Dohne section of the stud sold 30 rams to an average $1,300. Kerin Poll from Yeoval cleared all 289 rams to average $2,246 with a top price of $10,000 being paid twice. The sale grossed $649,000 - a new Australian record for an on property ram sale. On the meat-sheep side Marocara Dorsets from Wongarbon cleared all 166 rams for a top price of $6,100 to average $1,638. All studs look to be gaining higher clearance rates and averages, a reflection of the solid prices for wool and meat and the confident outlook and great seasonal conditions to look forward to in the short term.

The big movement in exchange rates, at one point 2.12% against the US$, was the major factor in the downward price direction, a complete contradiction to earlier signals in the week. In US$ and other ‘buy-in’ currencies, the market did improve in ‘delivered-to-mill’ prices to all major using countries signaling demand for most types remains strong but currency movements will dictate price more than other factors as the national offering drops back to 38,000 bales.       

 

Ag Concepts Fwd Prices at 9 September 2016

Micron

Date

Low

High

21

21-Sep-16

1455

1455

21

19-Oct-16

1415

1415

 

Main Buyers (This Week)

 

1

Chinatex

4971

2

Fox & Lillie

4314

3

Lempriere (Aust)

3429

4

Techwool

3352

5

PJ Morris

2901

6

Aust. Merino Exp

2478

7

Modiano

2019

8

G Schneider

1654

9

Zhong Long Int.

804

 

 

Eastern Market Indicators (AUD cents/kg clean)

1305 cents ê 15 cent compared with 2/09/2016

Northern Market Indicators (AUD cents/kg clean)

1330 cents ê 14 cents compared with 2/09/2016

AUD/USD Currency Exchange

0.7680 é 0.0137  compared with 2/09/2016

2 September 2016

Friday, September 02, 2016

WEEKLY MARKET REPORT

Week Ending 2nd September, 2016

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S09/16

This Week

M09/16

Last Sale

S08/16

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1599n

1569

1588n

+11

1458

+141

18

1567

1546

1553

+14

1406

+161

19

1513

1506

1496

+17

1343

+170

20

1490

1475

1478

+12

1294

+196

21

1480

1467

1471

+9

1286

+194

22

1462n

1458

1452n

+10

1274n

+188

26

1167n

1150n

1139n

+28

1061n

+106

28

791

786n

777

+14

905

-114

30

-

671n

677

-7 (M)

857 (M)

-186

MC

1056

1043

1053

+3

1063

-7

MARKET CLOSES IN ON 12 MONTH PEAK

 

Futures trading was spot on late last week as the 20 cent gain filtered through to the physical market as the EMI added 11 cents to its value (now 1320), an identical rise to last sale and equal with the 12 month high of Sale 01. In US$ terms the move was the barest minimum (1 cent) down to 995. Prices increased in a very orderly fashion, 10 to 15 cents for 17 to 23 micron with the super-fine indicators <17 just in sellers’ favour, somewhat disappointing considering this was the opening designated super-fine sale of the season. Despite the indicator’s muted gains, some types with the right specs were up to 100 cents better than their indicators with some 16.5 to 18.5s 170 to 200 cents higher than 3 weeks ago.

Skirtings also profited from the renewed competition as the superior selection saw buyers push the <3% VM lots 10 to 15cents higher while all others were in sellers’ favour. BKNs finer than 19 micron and <4% VM are commonly making 800 to mid 900 cents and up to 15% VM fetching over 600 cents - great money for these wools. Crossbreds enjoyed the lower exchange rate as finer types out to 28 micron posted 15 to 30 cent gains as 30s and broader looked up to 5 cents cheaper. Cardings had a solid sale edging marginally higher as the three regional MCIs sit around 1050.

All the good judge’s forecasts rang true as the favourable exchange rate (falling by over 2.5 cents in 2 weeks) drove buyer competition to new levels. The longer fibred wools (merino and crossbred fleeces) are in good demand as some overseas users are finding it somewhat problematic to get set for larger quantities from exporters to ensure supply at current rates. Surprisingly, the shorter wools and cardings remain subdued as manufacturers try to establish a new buy-in price that will stimulate sales of garments made from these types into the Northern Hemisphere winter.

Plenty of activity in the futures market as 75 tonnes was traded this week out till May 2017 - 21s at 1370/80 - with September trading at 1450/60 for the same micron, just 20/30 cents below the physical market and 1430 for early November. These prices are at historically high levels.

This current rain event will impact on shearing being delayed and wool receivals slowing to a walk. Volumes for Sale 12 and 13 will be smaller than forecasted applying pressure to buyers as the catalogues shrink in the short term and, with the anticipated wettest September for years (20+ days of rainfall is all the talk), this situation could drag on for longer than we think. The national catalogue is just shy of 43,000 bales next week. We open proceedings on Thursday with a 1000 bale catalogue and a firm to unchanged market is expected.

 

Ag Concepts Fwd Prices at 2 September 2016

Micron

Date

Low

High

Micron

Date

Low

High

21

28-Sep-16

1450

1450

28

25-Jan-17

765

765

28

26-Oct-16

775

775

19

22-Mar-17

1450

1450

21

9-Nov-16

1410

1410

21

24-May-17

1380

1380

 

Main Buyers (This Week)

1

Techwool

5592

2

PJ Morris

4528

3

Chinatex

3940

4

Fox & Lillie

3565

5

Aust. Merino Exp

3238

6

Lempriere (Aust)

3148

7

Tianyu Wool

2553

8

Modiano

1904

9

West Coast Wool

1555

 

 

Eastern Market Indicators (AUD cents/kg clean)

1320 cents é 11 cent compared with 26/08/2016

Northern Market Indicators (AUD cents/kg clean)

1344 cents é 11 cents compared with 26/08/2016

AUD/USD Currency Exchange

0.7543 ê 0.0068  compared with 26/08/2016