Weekly Market Reports


25 October 2019

Friday, October 25, 2019

WEEKLY MARKET REPORT 

Week Ending 25th October, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S17/19

This Week

M17/19

Last Sale

S16/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1922

1924

1898

+24

2582

-660

18

1865

1873

1850

+15

2397

-532

19

1789

1797

1763

+26

2258

-469

20

1748

1748

1722

+26

2175

-427

21 1743n 1743 1712n +31 2153 -410
26 1160n 1188n 1160n 0 - -

28

889n

924

899n

-10

795

+94

30

675n

705

685 (M)

+20 (M)

671n

+4

MC

987n

1035

987n

0

1143

-156

MARKET SHOWS SIGNS OF MEASURED RECOVERY

The market’s current yo-yo movements kept going this week with an upward trend as last sale’s falls were recovered. The positive tone from last Thursday flowed through for 2 days of solid rises for the AWEX EMI for a gain of 28 cents to 1545 and an identical rise in US$ terms to 1058. The AUD/US$ has been trading in the mid to high 68 cent bracket for 2 weeks after trading in the 67 cent range for a month before that but these fluctuations seem not to be influencing the market with everything else going on and are having very little effect on price direction. Gains for fleece types were pretty even - 15 to 35 cents for all microns. Skirtings added 10/20 cents while cardings remained firm and XBs added 10 cents for < 27 and fell 10 cents for 28 and coarser.

Consensus amongst buyers is that the change in sentiment along the pipeline that these price levels are more and more acceptable as the past 3 weeks of sales have shown and hopefully the erratic price movements of August/September are just a memory. Global economies look to be swinging to more positive outcomes with early autumn sales hopefully showing that Northern Hemisphere consumers are ramping up their spending. If Britain and the EU can resolve their differences, the UK can avoid a general election, resolve the Brexit issues quickly and the China/US trade war dies down global economies could dodge the bullet (Recession) everyone fears. A significant factor in the market’s dearer trend was the largest Chinese top-makers ramping up their buying after a quiet month or so. This could be an indication that the backlog of tops to spinning stage wools is clearing where cash flow has been tight due to delays in the uptake of contracts.

Ram sales are finished in this part of the state with the focus now down south. The Henderson family from Grogansworth stud at Yass cleared 87% for a top price of $8,000 to average $2205; Egelabra at Warren had a 100% clearance (146) to average $2,700 with a top price of $18,000; Glenwood at Wellington gained a top price of $5,800 to average $2,215 for an 89% clearance; and Hazeldean held their Hay sale to sell all but 2 of the 110 rams offered with a $2,600 average and a top price of $6,500. All the showfloor talk is of a solid to dearer market despite the largest selection since early August.

Main Buyers (This Week)

1

Techwool

5069

2

PJ Morris

3204

3

Fox & Lillie

1999

4

Aust. Merino

1980

5

United Wool

1964

6

Endeavour Wool

1767

Eastern Market Indicators (AUD cents/kg clean)

1545 cents é 28 cents compared with 18/10/2019

Northern Market Indicators (AUD cents/kg clean)

1560 cents é 15 cents compared with 18/10/2019

   AUD/USD Currency Exchange

0.6848 é 0.0061  compared with 18/10/2019

18 October 2019

Friday, October 18, 2019

 WEEKLY MARKET REPORT 

Week Ending 18th October, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S16/19

This Week

M16/19

Last Sale

S15/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1898

1884

1902

-4

2743

-845

18

1850

1839

1867

-17

2530

-680

19

1763

1770

1788

-25

2330

-567

20

1722

1708

1762

-40

2262

-540

21 1712n 1706 1753 -41 2223 -511
26 1160n 1156n 1170n -10 1301n -141

28

899n

909

940n

-41

846 (M)

+63 (M)

30

-

685

719 (M)

-34 (M)

758 (M)

-73 (M)

MC

987n

1004

991n

-4

1299

-312

MARKET HOPEFULLY HAS FOUND THE LEVEL!

The volatile nature of the market is still well and truly in play as price levels of last sale couldn’t be maintained this week but the degree of fluctuations not as bad (or good) as some over the past 6 weeks. The market opened on a softer note as the 3 centres fell but Fremantle did stage a late recovery on Wednesday. This flowed through to the eastern seaboard on Thursday as minor gains were recorded. By the end of the sale the AWEX EMI fell 26 cents to 1517, < 17.5 were in buyers’ favour while 18s and broader lost 20/40 cents. Skirtings followed a similar pattern to their fleece counterparts to finish the sale 20 cheaper. Cardings were the least affected sector as LKS/STN lost 10 to 20 cents while XBs retreated by 10 to 40 cents.

Trading looks to have returned to somewhat of a normal pattern as the EMI has settled just above 1500 cents - hopefully a bottom level of the market as writing business seems to be easier than a month ago but price movements are still largely driven by supply both for volume and wool types. The acceptance of these prices is widespread as most mills are committed to strategising loss-recovery plans from the hectic financial results caused by the dramatic downturn in price with sentiment at the other end of the wool textile chain still subdued.

Could the global economy be showing signs of recovery?? Now that Brexit is locked in to go ahead without any more hiccups and the US-China trade war not as bullish as the rhetoric may have sounded world economies might have dodged a bullet. Retail sales in China rose by 0.7% in August compared to 12 months ago and their trade surplus increased to US$40 billion in September, up by US$9 billion from September, 2018, putting the yearly trade surplus up to US$300 billion, $80 billion higher than the same period last year. Chinese exports did however drop by 3% but were offset by an import reduction of 8%. Their growth in retail sales is good news for woolgrowers as they buy 75% of our wool of which 45% is sold as woolen products in China, putting them at no1 for the largest consumer of wool in the world.

Next week has 33,000 bales on offer with only enough wool in Sydney for a 1 day sale as some growers hold onto their wool waiting for a dearer market and those who have passed-in wool wait for the market to recover up to that level or better. Going on Thursday’s dearer trend we hope the market can keep moving upwards.

Southern Aurora Fwd Prices         

Micron

Date

Low

21

November 19

1670

Free knitted woollen jumpers for poddy lambs. Call into our office in Dubbo or Macdonald Rural at Brewarrina and take as many as you need. Many colours and styles to choose from!

Main Buyers (This Week)

1

Techwool

4383

2

Endeavour Wool

3240

3

Aust. Merino

2911

4

PJ Morris

2759

5

Fox & Lillie

2323

6

Seatech Ind.

1537

Eastern Market Indicators (AUD cents/kg clean)

1517 cents ê 26 cents compared with 11/10/2019

Northern Market Indicators (AUD cents/kg clean)

1545 cents ê 22 cents compared with 11/10/2019

   AUD/USD Currency Exchange

0.6787 é 0.0039  compared with 1110/2019

11th Oct 2019

Friday, October 11, 2019

WEEKLY MARKET REPORT

Week Ending 10th October, 2019

AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S15/19

This Week

M15/19

Last Sale

S14/19

Sydney Change

Last Year

Sydney

Sydney Yearly

Change

17

1902

1901

1872

+30

2869

-967

18

1867

1859

1840

+28

2583

-716

19

1788

1788

1739

+49

2346

-558

20

1762

1739

1699

+63

2225

-463

21

1753

1731

1684

+69

2186

-433

26

1170n

1211n

1150n

+20

1351n

-181

28

940n

963

908n

+32

904n

+36

30

-

719n

-

-

701n

-

MC

991n

1021n

1005

-14

1385

-394

MARKET RECOVERS BUT FOR HOW LONG??

The wool market continued on its volatile and erratic path this sale, but growers benefitted from renewed competition as the AWEX EMI added 32 cents to sit at 1543. As has been the case for some time now, the big swings in price (both ways) have thought to be over-done, rising by too much and falling far quicker and further than most thought. This, again was the case last week as the EMI collapsed by 98 cents and to everybody’s relief clawed back 1/3rd of those losses this sale, the level the market finished at was enough to extract fresh business from our major customers. Fleece microns <18.5 rose by 25/30 cents while 19s and broader gained 50 to 70 cents. Skirting’s added 20 to 40 cents for all types while XB’s were quoted 20 to 30 cents higher. The only sector to fall was cardings, losses ranging from 20 to 40 cents.

Since wool sales resumed in early August, the EMI has moved a total of 763 cents up and down, an average of 76 cents over those 10 weeks or 49% of the EMI (1543). Even the veteran’s of the trade think these large price fluctuations are unprecedented and make trading a very difficult proposition that could continue for some time. Uneasy global economic conditions  that could result in some countries slipping into recession, the ongoing trade tensions and Brexit are still at the forefront of most Western governments which is leading to economic slowdown as consumer confidence weakens and  leads to lower demand from wool processing destinations despite shrinking volumes of wool from Australia. The supply and demand balance is in question as reports of building up of early stage processing stocks in China are countered by the ever eroding supply of wool from NSW & QLD. In the short term demand could swing from good to bad as processors try to work out what price level is fair value through the pipeline and at the retail level.

A few more ram sales to report on; Cassilis Park had a 100% clearance for a top of $3,800 (2) to average $1,530,  Bundilla at Young sold all but 2 of their 239 rams for a top of $10,000 to average $3,270 and Blyth at Adelong sold 77% to achieve a top of $6,500 to average $1,635. We have Canola hay for sale ex Lockhart @ $260/tonne (plus GST) if anyone is interested, contact Ros Press at Macdonald Rural on 0427 704 457.                                                            

                                    Southern Aurora Fwd Prices as at 10th October, 2019

Micron

Date

Low

High

21

6-11-19

1750

1750

 

Main Buyers (this week)

1

Techwool

4011

2

Fox & Lillie

3482

3

Endeavour Wool

2635

4

PJ Morris

2449

5

Australian Merino

2177

6

United Wool

1410

 

 

 

 

Eastern Market Indicators (AUD cents/kg clean)

1543cents é32 cents compared with 10/10/2019

Northern Market Indicators (AUD cents/kg clean)

1567cents é 29 cents compared with 10/10/2019

 

 

 

AUD/USD Currency Exchange

0.6748 é 0.0030 compared with 10/10/2019

4 October 2019

Friday, October 04, 2019

 WEEKLY MARKET REPORT 

Week Ending 4th October, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S14/19

This Week

M14/19

Last Sale

S13/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1872

1898n

2003

-131

2869

-997

18

1840

1852n

1965

-125

2583

-743

19

1739

1727n

1871

-132

2346

-607

20

1699

1689n

1843

-144

2225

-526

21 1684n 1687n 1828n -144 2186 -502
26 1150n 1188n 1240n -90 1351n -201

28

908n

936

988n

-80

904n

+4

30

-

738n

814n (M)

-76 (M)

729 (M)

+9 (M)

MC

1005

1040

993n

+12

1385

-380

DEMAND IS KING BUT VOLATILITY RULES!!

The market hit a brick wall this sale as demand almost completely dried up. The cheaper market in Fremantle last Thursday was the absolute indicator of things to come this sale as the volatility in the market continued as last series’ gains were completely wiped out when the AWEX EMI fell by 98 cents to 1511. All FLC indicators recorded triple figure losses, 120 to 145 cents. Most skirtings dropped by 80 to 110 cents bar the better style low VM types which gave up 60/80 cents. Crossbreds also suffered heavy losses - 80 to 100 cents while cardings were the only shining light to be firm to sellers’ favour. We were fortunate enough to open the sale on Wednesday and escaped most of the carnage with some NM lots 25 to 100 cents better than their indicators.

This degree of volatility has not been seen in the market according to wool buyers with 40+ years of experience. Over the past 9 weeks, since sales resumed, the EMI has lost 389 cents, regained 244 and this sale fell 98 cents. Volatility is running above 40% for 19 & 21 micron and in the last 10 years the EMI has moved either direction by more than 50 cents in a single day 19 times, with 9 since January and 7 in the past 9 sales. On two occasions has the EMI had a daily shift more than 100 cents, both in the last 6 weeks.

The shrinking volume is again front and centre with the latest release of testing figures from AWTA. September is back by 13.7% compared to last year and for the first quarter of the season the decline is 14% (55,000 bales) from last season. The total bales offered is worse, 81,500 (19.6%) less than last year so far - alarming figures.

More  Ram sales results: Allendale at Wellington cleared 78% with a top price of $3,500 to average $1320, other results from  Wellington: Mumblebone sold all but 2 rams from 200 offered to average $2905 to top out at $12,000 (2); and Boxleigh Park topped at $3,200 for a $1,490 average; Langdene at Dunedoo sold 87% to average $3,030 with a top price of $9,000; while Dunbogan 85% sold with a top of $2,600 to average $1265; at Peak Hill Westray/Genanegie cleared all 164 on offer to average $2,565 topping out at $16,000; and Cora Lynn averaged $1,645  with a top of $3,800 to clear 95%.


         Southern Aurora Fwd Prices as at 4th October, 2019       

Micron

Date

Low

High

21

16-Oct-19

1680

1680

Free knitted woollen jumpers for poddy lambs. Call into our office in Dubbo or Macdonald Rural at Brewarrina and take as many as you need. Many colours and styles to choose from!

Main Buyers (This Week)

1

Techwool

3416

2

PJ Morris

2082

3

Fox & Lillie

2266

4

Aust. Merino

2082

5

Endeavour Wool

1862

6

Michell Wool

1233

Eastern Market Indicators (AUD cents/kg clean)

1511 cents ê 98 cents compared with 04/10/2019

Northern Market Indicators (AUD cents/kg clean)

1538 cents ê 97 cents compared with 04/10/2019

   AUD/USD Currency Exchange

0.6718 ê 0.0039 compared with 04/10/2019