Weekly Market Reports


23 August 2019

Friday, August 23, 2019

 WEEKLY MARKET REPORT 

Week Ending 23rd August, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S08/19

This Week

M08/19

Last Sale

S07/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

1952

1923

2000

-48

2917

-965

18

1888

1860

1932

-44

2617

-729

19

1728

1734

1766

-38

2393

-665

20

1683

1681

1711

-28

2303

-620

21 1667n 1675 1695n -28 2280 -613
26 - 1148n 1150n - 1538n (M) -390 (M)

28

870n

855

835n

+35

930n

-60

30

710n

701

743 (M)

+42 (M)

711 (M)

-10 (M)

MC

895n

930n

993

-98

1526

-631

MARKET STEADIES!

All participants were still in shock from last series’ falls and wondering what this week would bring. Showfloor chatter amongst the buyers that some business had been done on a variety of types just below current levels gave hope that the market may level out sooner rather than later. The AWEX EMI lost just 16 cents but did fall below the 1500 cent mark to 1497 - this result welcomed as good news after last week’s carnage. Fine microns bore the brunt of losses, < 19 micron 40/50 cents with broader types 20 to 30 cheaper with the odd superior style wool and NM type dearer. One sector that did advance was skirtings, 40 to 50 cents higher, just 10% passed-in. Crossbreds also reversed last sale’s collapse adding 25 to 45 cents. Cardings took the largest hit of any sector with the 2 MCIs on the east coast averaging 94 cent losses as LKS/LMS lost 100 to 200 cents while CRT/STN gave up 50 to 60 cents. The overall pass-in rate fell to 16%, a drop of 20% compared to the previous sale with 16% also withdrawn resulting in a third of the wool available at the start of the sale not sold.

This week’s sentiment was vastly improved when compared to the fortnight before, with a very cautious tone. The demand for wool has fallen sharply due to lack of confidence and partly to blame is the devaluation of the Chinese Yuan (CNY). One US$ buys over 7 yuan compared to 6.8 yuan in July. All the other external problems in the Northern Hemisphere are still well and truly in play and this week Germany announced that its economy is slowing as is Britain’s (they’re yet to admit it). Trouble is also brewing in SA as wool sales have been suspended indefinitely as frustrations re the requirements of current export certification of greasy wool into China were conveyed and the ensuing implications for buyers and growers. Auctions will resume ASAP when clarity is obtained regarding export certification requirements of greasy wool into China.

We still have spots available if you want to attend the Sheep Welfare Seminar on Tuesday. Please reply to the office by Monday on 6884 1004 or email admin@macwool.com.au.

Ag Concepts Fwd Prices as at 23 August, 2019

Micron

Date

Low

High

21

25-Sep-19

1660

1680

21

13-Nov-19

1650

1650


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

Tianyu Wool

2588

2

Fox & Lillie

2533

3

Aust. Merino

2515

4

Techwool

2330

5

Endeavour Wool

1985

6

G Schneider

1235

Eastern Market Indicators (AUD cents/kg clean)

1497 cents ê 16 cents compared with 16/08/2019

Northern Market Indicators (AUD cents/kg clean)

1521 cents ê 17 cent compared with 16/08/2019

   AUD/USD Currency Exchange

0.6783 ê 0.0001 compared with 16/08/2019

16 August 2019

Friday, August 16, 2019

 WEEKLY MARKET REPORT 

Week Ending 16th August, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S07/19

This Week

M07/19

Last Sale

S06/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2000

1963

2117

-117

3007

-1007

18

1932

1923

2075

-143

2682

-750

19

1766

1753

1923

-157

2465

-699

20

1711

1698

1909

-198

2398

-687

21 1695n 1694 1900n -205 2376 -681
26 1150n - 1320n -170 1507 -357

28

835n

830

1000n

-165

944

-109

30

-

659n

793n (M)

-134 (M)

736 (M)

-77 (M)

MC

993

1020n

1040n

-47

1515

-522

HORRENDOUS!!!

One word could best describe this week’s wool sale, ”HORRENDOUS” as all sectors of the market plummeted to have the AWEX EMI at its lowest level for 2 years, now at 1513. The fall was 163 cents for the series, 9.7%, which is the largest weekly fall since 2003 with the biggest opening day fall in 11 years. Finer types < 19 micron fell 100 to 150 cents while 19.5 and broader averaged exactly a 200 cent shellacking. Skirtings gave up 150/200 cents, crossbreds were back by 130 to 160 cents while cardings reversed last week’s gains to fall 20 to 80 cents depending on type. The national pass-in rate was 36% - the highest for 16 years with 17% withdrawn. The only exception to the massive discounts were the sub18 micron best topmaking/spinners style where reductions looked to be 40 to 70 cents and most non-mulesed types increased their premiums dramatically with some “NM” lots  commanding 60 to 400 cents clean over the indicator price as buyers report more and more enquiry for NM wool. Prior to recommencement of sales the premium was in 50 to 20 cent range. Our NM wools came from Gilgandra and Binnaway to Yeoval, Wellington and Gulgong that were paid handsomely for their wool.

Again the predicament for the wool market was external factors as global stock markets shuddered on the forecast of global recession on the horizon; the ongoing unrest in Hong Kong along with Brexit; the tariff wars and tension in the Persian Gulf which has most Western governments nervous. When this happens consumers become cautious and stop spending money thus slowing economic growth. Some good news is the US decision to delay some new tariffs from September to December following pressure from retailers fearing a negative impact on their turnover but, for Aussie wool producers, woolen clothing imports from China wasn’t granted the extension - this decision adding to Chinese processors’ concerns for orders for their Autumn/Winter season.

The Australian wool production forecasting committee met on Wednesday and, to no-one’s surprise, their forecast was down 5% to 285mkg for this current season due to ongoing drought resulting in less sheep (record prices for lamb and mutton) and low lambing rates that are hamstringing growers from increasing flock numbers. Buyers have reported sporadic volumes of business being done with the market soon to find a level.


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

Tianyu Wool

3689

2

Aust. Merino

2984

3

PJ Morris

1824

4

Fox & Lillie

1792

5

Techwool

1519

6

G Schneider

1328

Eastern Market Indicators (AUD cents/kg clean)

1513 cents ê 163 cents compared with 09/08/2019

Northern Market Indicators (AUD cents/kg clean)

1538 cents ê 166 cent compared with 09/08/2019

   AUD/USD Currency Exchange

0.6784 ê 0.0010 compared with 09/08/2019

9 August 2019

Friday, August 09, 2019

WEEKLY MARKET REPORT 

Week Ending 9th August, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S06/19

This Week

M06/19

Last Sale

S02/19

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2117

2070

2175

-58

2816

-699

18

2075

2040

2143

-68

2478

-403

19

1923

1920

2043

-120

2292

-369

20

1909

1909

2033

-124

2232

-323

21 1900n 1898 - -139 (M) 2210 -310
26 1320n 1316 - -57 (M) 1430n -110

28

1000n

994

1045n

-45

871

+129

30

774n

793

-

-68 (M)

648

+126

MC

1040n

1048

1010

+30

1466

-426

WOOL MARKET GETS TRUMPED!!

Wool sales resumed this week with the market copping a hiding. Talk late last week and early this week was positive for some sectors of the market but sentiment did a 360 degree turn as external influences took their toll. Large falls on both days saw the AWEX EMI collapse by 78 cents to 1676 as finer microns (< 18.5) lost 60 to 90 cents and 19s and broader shed 120 cents. Skirtings fell by 70 to 100 cents while XBs gave up 30 to 60 cents. The only positive sector of the market was Cardings, most types adding 20 to 60 cents to their pre-recess levels.

Why the sudden change?? The tit-for-tat trade war between US and China escalated to new levels this week with Trump announcing a 10% tariff on US$300 billion worth of Chinese goods bound for the US. In retaliation China devalued its currency (RMB/Yuan) after it fell to an 11 year low (at the start of the GFC) caused by the tariff measures imposed by America. A weaker yuan makes Chinese exports more competitive thus offsetting the impact of raised tariffs in theory making Chinese products cheaper for consumers. On the flip-side the weaker yuan makes imports going into China more expensive: coal, gas, iron ore and wool so the price paid is adjusted down to compensate. The Chinese move to make their exports more competitive strikes at the heart of Trump’s trade war with them with many economists predicting the yuan could be devalued by another 5% by the end of the year - more bad news for Aussie exports to China.

With the positive start to the season in early July and a 2.8% swing in the FRX since then, hopes the market could continue in the same vein were short lived. Despite the ongoing short fall in supply, confidence from mills in China has all but eroded, as sales are running at about half of the normal quantity and most plants running at about 60-70% of their capacity which, given the lack of volume, they are still processing 10 to 20% more wool than they can sell down the pipeline, thus the potential for more price falls. As global economic growth slows consumer demand wanes as the prolonged trade war has some economists talking recession if a resolution isn’t forthcoming soon. Next week has a similar volume of wool available but no sign that the market can rebound. Don’t forget to register for the Sheep Welfare & Husbandry Best Practice Seminar at the Garden Hotel on 27th August.

Ag Concepts Fwd Prices as at 5 July, 2019        

Micron

Date

Low

High

21

11-Sep-19

1850

1850

21 23-Oct-19 1900 1900

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

Fox & Lillie

5002

2

Tianyu Wool

3625

3

Techwool

3293

4

Aust. Merino

2292

5

Endeavour Wool

2122

6

G Schneider

1551

Eastern Market Indicators (AUD cents/kg clean)

1676 cents ê 78 cents compared with 12/07/2019

Northern Market Indicators (AUD cents/kg clean)

1704 cents ê 76 cent compared with 12/07/2019

   AUD/USD Currency Exchange

0.6774 ê 0.0192 compared with 12/07/2019