Weekly Market Reports


29 March 2018

Thursday, March 29, 2018

WEEKLY MARKET REPORT

Week Ending 30th March, 2018

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S39/17

This Week

M39/17

Last Sale

S38/17

Sydney Change

Last Year

Sydney

Sydney Yearly Change

17

2764

2731n

2776

-12

2290

+474

18

2301

2299

2348

-47

2153

+148

19

2037

2035

2074

-37

1873

+164

20

1922

1929

1960

-38

1535

+387

21

1888

1886

1914n

-26

1414

+474

22

-

1858

-

+14 (M)

1337 (M)

+521 (M)

26

-

1198

1168

+13 (M)

1016n (M)

+182 (M)

28

859

871

842

+17

740

+119

30

610

614

588

+22

575

+35

MC

1332

1341n

1330n

+2

1223n

+109

NO EASTER EGGS OR SHOWBAGS FOR BUYERS THIS YEAR!!

Growers were looking forward to selling at the showcase sale to be held at the Royal Easter Show this week as the 3 previous years has seen the market rise but last Thursday’ s softening market would have had all sellers nervous. The forecast increase in quantity saw buyers release the pressure valve regarding buying strategies as the urgency to buy wool was negated by the predicted 47,000 bales. This quantity, as is always the case, didn’t eventuate as 44,800 were offered. This did not help the market though as the EMI slid 6 cents to 1772, Sydney back by 15 cents and Melbourne adding just 1 cent to its previous level. A decrease in the FRX to below 77 cents didn’t help the market either but saw the EMI (in US$ terms) also drop by 13 cents to 1364. Losses were across all the merino fleece micron ranges to 21, the least affected was 17 micron losing 10 cents while all others saw 20 to 50 cents peeled off their values as 22s and broader posted gains of 10 cents. Again, the high mid-break with high VM levels and colour/cott types were discounted heavily but lots displaying the right “specs” in most cases were solid to dearer when compared to the previous series.

Skirtings looked to have escaped the cheaper trend of the fleece room as finer lots < 18 micron and with VM < 5% came back by 10/20 cents while broader types, regardless of VM levels, remained unchanged. Cardings recorded modest rises as the MCI in Sydney edged ahead by just 2 cents to 1332. The other 2 centres also gained ground for the series as Melbourne put on 14 cents to 1341 and the stand-out of any sector was the cardings in Fremantle where their MCI added a whopping 57 cents to its value to finish at 1310 cents. Crossbreds also continued on their good run as all indicators were quoted up to 20 cents dearer.

A bit of a disappointment as the market slid for the 8th selling day from the last 10. The sale couldn’t produce last year’s meteoric rises for the EMI of 53 cents or the good rise of 12 cents from the previous 2 years. Most growers were still happy to meet the market as just 6% of fleece was passed-in, 29 bales of skirtings not sold (1.2%), oddments and XBs cleared over 96%. In the 12 sales since the resumption in January the market opened at 1760 and peaked at 1834 on Wednesday, 28th February, with the lowest point at exactly 100 cents (1734) behind the peak a month earlier on 31st January. The carding market peaked at an incredible 1546 on the 16th January only to record a huge correction over the following 2 weeks to its lowest point of 1292 on the last day of that month.

Everyone now takes a one week recess to catch their breath from a frantic 12 sales and try to work out how the market will play out through till June. The underlying factors of supply and demand will hold sway for the most part with the FRX, weekly quantities and the deteriorating quality of wool entering the market will also influence buyers purchasing strategies. Next sales volumes have exploded from 48,800 to over 57,000 bales, buyers will be under no pressure to chase wool unless a heap of business is done over the next week.

Main Buyers (this week)

1

Techwool

4785

2

Fox & Lillie

4309

3

Tianyu

3946

4

Aust. Merino Exp.

3372

5

Seatech Ind

3099

6

Modiano

2511

7

Endeavour  Wool

2274

8

Kathaytex (Vic)

1682

9

PJ Morris

1218

Eastern Market Indicators (AUD cents/kg clean)

1772 cents ê 6 cents compared with 23/03/2018

Northern Market Indicators (AUD cents/kg clean)

1837 cents ê 15 cents compared with 23/03/2018

AUD/USD Currency Exchange

0.7700 ê 0.0045 compared with 23/03/2018

23 March 2018

Friday, March 23, 2018

WEEKLY MARKET REPORT

Week Ending 23rd March, 2018

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S38/17

This Week

M38/17

Last Sale

S37/17

Sydney Change

Last Year

Sydney

Sydney Yearly Change

17

2776

2740n

2746n

+30

2411

+365

18

2348

2279n

2328

+20

2242

+106

19

2074

2044

2027

+47

1945

+129

20

1960

1947

1912

+48

1620

+340

21

1914n

1888

1854

+60

1484

+430

22

-

1844

1823n

+36 (M)

1409n (M)

+435 (M)

26

1168

1185n

1153

+15

1015

+153

28

842

839

804

+38

745

+97

30

588

595

571

+17

575

+13

MC

1330n

1327n

1298n

+32

1227

+103

MARKET RECAPTURES SOME LOSSES!

After 2 weeks of negative direction the wool market went some of the way to recovering some of those losses. The AWEX EMI posted a 27 cent rise (identical to the previous sale’s losses) to finish the week at 1778. The EMI in US$ terms was virtually unchanged, a drop of just 2 cents to 1377, this due to the erratic swings of the FRX from 78.7 last Friday to a low of 76.75 on Wednesday to settle at 76.85 cents this morning - a 2% swing at one stage to the exporters. Signs that the market might settle came through late on Monday as futures were trading solid to dearer out to the spring and early into 2019. This led to the physical market rocketing to life on Wednesday as all sectors (bar skirtings) added 20 to 50 cents. This rapid and welcome rise was somewhat tempered in the final session as the FRX influenced prices to see most types give up 5 to 15 cents. Discounts for the usual faults in the fleece sector shrunk to almost nothing as buyers chased the smaller offering to see less than 1% passed-in on the opening day.

Skirtings had a reasonable sale without benefitting from any real increases like their fleece counterparts. The finer micron < 18 and < 5% VM were quoted about 10 cents dearer as the 18/19 micron types with 5 to 8% VM lost 10 to 20 cents. Cardings had a good sale after the big first session rise - prices consolidated on the final day. Both MCIs on the East Coast averaged 30 cent gains to be back above 1300 cents (1330 and 1327) most types in this sector lifted by 30 to 35 cents. Crossbreds also were swept up in the rising market to recover last sale’s hiccup. All microns rose by 15/20 cents except 28s which leapt by 38 cents to have the XB sector record 5 weekly gains from the past 6 sales.

Plenty of factors came into play this week to influence the direction of the market. The smallest national catalogue of the year (38,200 bales), an improvement in prompt demand and a favourable FRX early in the series all had their roles in lifting the market and some buyers had already locked in at the cheaper delivered price (in US$) and other FRX which also boosted the market and for some microns (19 to 21) beyond the currency shift. Thursday’s slight pullback was almost completely blamed on the explosion in the offering for next week, a 21% increase (8000 bales) to 47,000 bales - Sydney’s volume almost doubling for the showcase sale at the Royal Easter Show. Once buyers saw these figures pressure came off to secure wool and the appreciating A$ took any urgency from buyers’ purchasing strategies.

Can the impending USA-China trade war affect the wool market?? Who knows? Stock markets and FRX fell heavily overnight and today as the Trump Administration announced tariffs of US$60 billion on Chinese imports in retaliation to theft of intellectual property. The A$ has retreated in morning trade to below 77 cents helped down by falls in key commodity prices and a slight rise in the unemployment rate. The A$ is 5.5% lower than its late January peak or 81.35 cents as the trade war and lifting of US interest rates will keep our currency under pressure and volatile.  We offer 1200 bales on the opening day (Tuesday) of the Easter Show sale, hopefully the lower A$ is enough to see the market stabilise.

Ag Concepts Fwd Prices as at 23 March, 2018

Micron

Date

Low

High

21

28-Mar-18

1875

1875

Main Buyers (this week)

1

Techwool

5432

2

Fox & Lillie

3749

3

Seatech Ind

2838

4

Endeavour  Wool

2808

5

Aust. Merino Exp.

2258

6

Modiano

2181

7

Tianyu

1827

8

Lempriere

1333

9

PJ Morris

1079

Eastern Market Indicators (AUD cents/kg clean)

1778 cents é 27 cents compared with 16/03/2018

Northern Market Indicators (AUD cents/kg clean)

1852 cents é 26 cents compared with 16/03/2018

AUD/USD Currency Exchange

0.7745 ê 0.0131 compared with 16/03/2018


16 March 2018

Friday, March 16, 2018

WEEKLY MARKET REPORT

Week Ending 16th March, 2018

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S37/17

This Week

M37/17

Last Sale

S36/17

Sydney Change

Last Year

Sydney

Sydney Yearly Change

17

2746n

-

2802

-56

2318

+428

18

2328

2283

2395

-67

2235

+93

19

2027

2026

2085

-58

1944

+83

20

1912

1920

1958

-46

1638

+274

21

1854

1863

1887

-33

1509

+345

22

1823n

1808

1863n

-40

1431n

+392

26

1153

1179

1170

-17

1015

+138

28

804

815

808

-4

756

+48

30

571

563

580

-9

581

-10

MC

1298n

1299n

1319n

-21

1234n

+64

 

30 YEARS AND STILL GOING STRONG!

The wool market continued in the same vein as last sale trending down by another 27 cents to 1751. In US$ terms the step backwards was not as severe, a 13 cent reduction to 1379 as the A$ appreciated 0.75 of a cent to 78 cents. Losses were similar on both days to have all merino fleece MPGs retract by 35 to 70 cents. Buyers became more and more selective in their purchases as high mid-breaks/levels of VM were punished. On the flip-side any lots that fitted the right “specs” (high strength, low VM and mid-breaks) were chased hard and commanded premiums of 30 to 100 cents on the few good lots we had from Goolma, Mudgee, Elong and Coonabarabran. Most growers, despite the drifting prices, took the money as 94% of fleece was sold.

Skirtings also kept pace with their fleece counterparts as losses ranged from 30 cents for fine low VM   types to 50/60 cents for broader burrier types with the ever increasing volume of heavy cott and colour in theses types attracting larger discounts. For the 2nd sale running the MCI lost 20 cents to fall below 1300 cents (1298) LKS being the main culprit peeling off 35 to 50 cents while CRS fell 20 cents and STN were quoted as fully firm. The firming market for XBs got the staggers this sale after 5 weeks of gains, the losses were minimal, 5 to 15 cents for most types, but still in good territory. Since the rises started in early February, 25/28 microns have jumped 110 to 130 cents while the 30s and broader are up to 30 cents better.

This sale’s “drifting”?? market demonstrated the under-current of swelling demand as late in the session the falling prices on several types was arrested to give hope that the sliding market is slowing. The hangover from Chinese New Year, high prices, quality of the selection and finance problems are still weighing on the market.

This week marked a huge milestone for Don. It was on 15th March 1988 his 1st catalogue was offered under the Lanoc Wool banner. The opening fleece lot in that catalogue was “BERRUMBUCKLE” a/c Tony Knight from Coonabarabran. His main line of 20.2 micron, 0.9, 75.7, no L/S test made 1450 cents (1915 cln) type 61. He sold his 2018 clip this week, with a top price of 1890 cents for 17.5 micron hogget wool. He told us that 1 tonne of “single super” fertiliser cost 7.5 fat lambs (today it’s about 3 fat lambs), shearing was $0.88/sheep and a schooner cost $1.20 - those were the days!! Well done to both, a great association and achievement.

Ag Concepts Fwd Prices as at 16 March, 2018

Micron

Date

Low

High

21

18-Apr-18

1820

1850

21

13-Jun-18

1760

1760

 

Main Buyers (this week)

1

Techwool

4750

2

Fox & Lillie

3952

3

Seatech Ind

3019

4

Aust. Merino

3017

5

Endeavour  Wool

2934

6

Lempriere

2717

7

PJ Morris

2389

8

Tianyu

2161

9

Modiano

1921

 

Eastern Market Indicators (AUD cents/kg clean)

1751 cents ê 27 cents compared with 09/03/2018

Northern Market Indicators (AUD cents/kg clean)

1826 cents ê 43 cents compared with 09/03/2018

 

AUD/USD Currency Exchange

0.7876 é 0.0044 compared with 09/03/2018

9 March 2018

Friday, March 09, 2018

       WEEKLY MARKET REPORT

            Week Ending 9th March, 2018

          AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S36/17

This Week

M36/17

Last Sale

S35/17

Sydney Change

Last Year

Sydney

Sydney Yearly Change

17

2802

-

2826

-24

2235

+567

18

2395

2353

2407

-12

2143

+252

19

2085

2043

2136

-51

1902

+183

20

1958

1932

2001

-43

1638

+320

21

1887

1883

1928n

-41

1501

+386

22

1863n

1838

1903n

-40

1439n

+424

26

1170

1198n

1152n

+18

1003

+167

28

808

820

805

+3

756

+52

30

580

570

583

-3

583

-3

MC

1319n

1299

1339n

-20

1231n

+88

 

BUYERS EXACT REVENGE!

As we forecast last report finance problems were on the horizon for buyers as the largest catalogue since mid January loomed. From the outset prices in all categories (bar XBs) came under pressure and retreated from the opening lot. By week’s end losses ranged from 10 to 50 cents for all microns out to 22s. The AWEX EMI gave up 52 cents to close at 1778 - the losses not as severe in US$ terms, back by 22 cents to 1393. The rising A$ to 78.3, up by 1.3% for the week, kept this figure from being any larger - this shift in FRX also contributing to the losses. Buyers extracted some revenge especially for high VM lots and high mid-break types, some of these up to 100 cents cheaper than last sale. Also on the “discount” radar is prem shorn fleece wool that measures < 70 mm. These 6 to 8 month shearings are becoming more popular but, if below the desired length, discounts come into play. Conversely, the low VM types (< 2% VM) with low mid-breaks were in high demand as their quotes looked solid from previous sales.

Skirtings also took their biggest hit for some time. The low VM lots < 3% lost 30/40 cents while the burrier types gave up 60 to 70 cents and more (up to 100 cents) for lots with excessive col/cott. Cardings continued to weaken as all types in this sector were 15 to 30 cents off the pace except for the odd LMS lot. XBs were the only sector to record any gains as 28 and finer gained up to 15 cents (their 5th weekly rise in a row) while broader microns were in buyers’ favour.

A tough sale as FRX and finance problems came to a head to have the EMI record its largest weekly loss since the end of January. As noted earlier, it was the inferior types that held sway to push the indicators down, these wools now dominating catalogues as we see more and more drought affected wool hit the market with a big price gap between these types and the fewer better style lots bound to widen, hopefully the better style wools will increase in value and the inferior types hold but a fall in prices is the favoured prediction.

The ABARES Outlook Conference was held in Canberra this week and with it came their release of 5 year forecasts for agricultural industries. Predictions for the EMI are a steady increase to 2015c/kg by 2022/23 to see the clip worth $5.74b by this time and sheep numbers to grow to 83 million in the same period.  We sell 1st on Wednesday next week, hopefully the market can steady.

Ag Concepts Fwd Prices as at 9 March, 2018

Micron

Date

Low

High

21

6-Jun-18

1770

1770

21

26-Sep-18

1640

1640

 

Main Buyers (this week)

1

Techwool

4095

2

Fox & Lillie

3879

3

Seatech Ind

3483

4

Aust. Merino Exp.

2832

5

Endeavour  Wool

2759

6

Tianyu

2407

7

Kathaytex (Vic)

2246

8

Lempriere

2208

9

Modiano

1781

 

Eastern Market Indicators (AUD cents/kg clean)

1778 cents ê 52 cents compared with 02/03/2018

Northern Market Indicators (AUD cents/kg clean)

1869 cents ê 31 cents compared with 02/03/2018

 

AUD/USD Currency Exchange

0.7832 é 0.102 compared with 02/03/2018


2nd March 2018

Friday, March 02, 2018

WEEKLY MARKET REPORT

Week Ending 2nd March, 2018

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S35/17

This Week

M35/17

Last Sale

S34/17

Sydney Change

Last Year

Sydney

Sydney Yearly Change

17

2826

2782

2793n

+33

2182

+644

18

2407

2383

2389

+18

2101

+306

19

2136

2151

2153

-17

1880

+256

20

2001

2019

2017

-16

1617

+384

21

1928n

1948

1927

+1

1508

+420

22

1903n

1915n

1886n

+17

1443n

+460

26

1152n

1155n

1128

+24

974

+178

28

805

810

798

+7

733

+72

30

583

576

593

-10

574

+9

MC

1339n

1334

1348

-9

1202n

+137

NEW RECORDS SET, BUT FINANCE A PROBLEM

For the 2nd sale in a row steady increases in the wool market were in play as the AWEX EMI added 10 cents-1830- to its previous level. The depreciation in the A$ by 2/3rds to 77.30 saw the EMI in US$ terms actually give up 5 cents to 1415. A 10 cent rise is good news, but there looks to be a few hidden stories behind the numbers. Sydney staged the final designated Super-fine sale of the season. Buyers, led by the Italian mills and to an extent forward and spot traders, chased the superior sub 18 micron types hard, theses indicators gained 20 to 55 cents with some lots up to 100 cents dearer. All microns broader than 18 had mixed fortunes, as 18.5s lost 10 cents, 19/20 lost 15 cents, and 21s unchanged with 22s up by 15 cents with the ever-increasing volume of high mid-break wools (>60) hitting the market getting hammered by 100 cents compared to lots with mid-breaks <60. After an aggressive opening day prices retreated on >18.5 to  see some losses recorded, maybe the larger national offering next week, 47,500 bales, up by 5% on earlier forecasts took the buying urgency out of the sale-rooms and for some buyers finance problems returned late on Thursday.

The skirting market also went in 2 directions as the best, finer (17 micron) low VM lots made good gains, up to 50 cents, while broader types over 5% VM with col/cott looked 20/30 cheaper. The carding market continued to soften after a dearer opening session, the MCI in Sydney fell 10 cents to 1339, LKS the main culprit giving up 30/35 cents while all other types remained solid. February has been a good month for the XB sector, 4 weeks of rises, this sale saw 28s and finer up by 10/25 cents, 30 micron the only negative, back by 10 cents.

Another positive sale as more records were broken. The EMI set a new daily record on Wednesday, 1834 and a new weekly high of 1830, after losing 4 cents on Thursday to eclipse January’s peak. 21s and 22s are at all-time highs in all 3 centres, 21s averaging 1935 and 22s at 1904, absolutely fantastic $$ for these microns. On the eastern seaboard new records were also set for 16.5, 19 and 20 microns. The table above illustrates just how big the increases have been over the past 12 months even the very volatile XB sector is ahead. Once again, the state of buyers finances reared its head late on the final day to be a factor for fall in the medium micron fleece wools particulary with high mid-breaks. The big  offering could test next weeks market as finances may not stretch through to the end the  sale, we sell mid-way on Thursday, fingers crossed.

                                                Ag Concepts Fwd Prices as at 23 February, 2018

Micron

Date

Low

High

18

23-May-18

2245

2245

19

23-May-18

2090

2100

Main Buyers (this week)

1

Techwool

6901

2

SeaTech Ind

4066

3

Fox & Lillie

3335

4

Modiano

2642

5

Lempriere

2502

6

Tianyu

2338

7

Endeavour

1859

8

Kathaytex Aust.

1588

9

Aust. Merino Exp.

1213

Eastern Market Indicators (AUD cents/kg clean)

1830 cents é 10 cents compared with 22/02/2018

Northern Market Indicators (AUD cents/kg clean)

1900 cents ê 2 cents compared with 22/02/2018

AUD/USD Currency Exchange

0.779 ê 0.008 compared with 22/02/2018