WEEKLY MARKET REPORT

Week Ending 24^th February, 2017

AWEX Northern Micron Indices Comparison

things are looking up!

Another good week for the wool market as the EMI consolidated its position in record territory - a 9 cents rise to 1449. The lift in $US terms more sedate - just a 3 cent shift to 1115 as the $AU spent most of the week hovering either side of 77 cents. The pleasing aspect for fleece types was the recovery in the medium microns, 19 to 22 microns were better by 5 to 20 cents erasing last sale’s losses. The finer microns took a bit of a breather as gains were in the 5 to 10 cent range, similar to last sale. Buyers looked to be warming up for the final super-fine designated sale of the season next week as finer lots <19micron with the right specs this week commanded premiums of 40 to 170 cents as a few “cracking” lots from Caloola via Bathurst, Yass and Jerangle via Cooma in our catalogue testify.

Skirtings had a pretty sedate sale as all types and descriptions across all VM ranges were rock solid. Again buyers were picking the eyes out them as the better spec types in the 16/17 micron range looked up to 10 cents higher (probably a guide as to what might happen with the better types next week). Cardings continued on their merry way as the 3 centres averaged 16 cent gains as all types in this sector quoted up to 30 cents higher. The 2 Eastern Seaboard centres carding indicators are at 1190 while Fremantle is 1208. It wasn’t that long ago the EMI was at that level!! Crossbreds again improved as 25/26 and 30 micron finished up to 5 cents dearer while 28 and 32s 10 to 20 higher. Let’s hope this is the start of a swift recovery for the XB sector.

Incredible is the only way to describe the response to our email and Facebook post on agistment for the victims of the Sir Ivan bushfire. As of today our Facebook post had reached 39550 people and has been shared 463 times. There have been many people contact us and stock agent Chris Callow with offers of help and, at this stage, we believe most people have themselves sorted as to the needs of their stock. What they (and most of us) now need is some good steady rain to begin the recovery.

There has been plenty of industry discussion of late about relocating wool sales from Yennora to Goulburn. A group of interested property developers egged on by local politicians have put proposals to all interested parties including ourselves. At this stage it seems unlikely to proceed as it appears a new lease at Yennora for the next five years will be signed by the major players hence sealing the fate the Goulburn proposal.

Next week a smaller offering of 42,000 bales will be offered in three centres.

Ag Concepts Fwd Prices at 24 February 2017

Main Buyers (This Week) 

WEEKLY MARKET REPORT

Week Ending 17^th February, 2017

AWEX Northern Micron Indices Comparison

not a great week but we survived!

We were hoping for a solid market and that’s what was delivered. Just a 3 cent rise for the EMI (1440) to eclipse the record set in January. In $US terms a more pronounced 16 cent lift saw it break through the 1100 cent barrier to 1112 - a good result considering the exchange rate lifted by a full cent from last sale. The market virtually moved in 3 directions: higher to start proceedings with a stylish Launceston offering, only to lose these gains on Wednesday before a closing day rally. By week’s end 18 and finer gained 5 to 15 cents, 18.5/19s were in sellers’ favour and 19.5 to 23s lost 10 to 25 cents.

Skirtings opened the sale on a cheaper note, shorter types 10/20 off the pace only to see a final day recovery as 5% to 8% VM lots claw back the 10 to 20 cent losses from the opening day. Cardings had a good sale as the 3 centres averaged an 11 cent rise in their MCI (1171 to 1193), now at all time highs. The most pleasing aspect of the market was the under pressure XB sector. For the first time in nearly 6 months all microns (25 to 32s) posted gains in the order of 10 to 20 cents.

As many of you would be aware it was a tough week to the east of us with the bushfires in the Dunedoo/Coolah/Cassilis area. Something like 54,000 hectares burnt, stock losses, houses, sheds and countless kilometres of fencing. Hot on the heels of the Wellington fire just after New Year it reminds us how close these disasters can be during seasons like this. We have had many clients affected in both these recent events and from both fires we hear lots of stories about the spirit of the communities that chimes in and pulls those in dire need through. Some of the stories coming through from the latest fire are both amazing and inspirational. Amazing that more stock and buildings weren’t lost and inspirational how individuals rose to the occasion and just dug in to get the job done. Several of our long standing clients were both severely affected or on the edge and in the thick of fighting the fire. Our thoughts go to those affected this week and our praise goes to the teams on the ground that achieved so much. Again, if anyone has any agistment available please come forward as there are a lot of stock that need moving to pastures in a hurry. The several offers that have come forward so far have been very generous.

Next week we hope to be just reporting on the wool market where 47,000 bales are to be offered nationally.

 Ag Concepts Fwd Prices at 17 February 2017

Main Buyers (This Week) 

WEEKLY MARKET REPORT

Week Ending 10^th February, 2017

AWEX Northern Micron Indices Comparison

MARKET KEEPS ON KEEPING ON!

Last sale’s consolidation was followed up by an even more pronounced rise in the benchmark AWEX EMI posting a 15 cent rise to 1437; just 2 cents shy of the record set in the 2^nd sale of the year. In $US terms the gain was 9 cents to 1096, outdoing their record by 11 cents set 3 weeks ago. The only type to finish in the red was 30/32 microns - back by 5 to 15 cents.  Buyers looked keen to secure wool from the outset as the final designated super-fine sale of the season saw a large volume of superior types offered in Sydney. Consistent rises over both days (led by European and Italian indent  orders) had 19s and finer 30 to 50 cents higher with some “crackers” 100 to 150 better than previous sales and ultra-fine microns <16 a massive 200 to 500 cents above the market. Medium microns also came under renewed buyer pressure as 19.5 to 23s added 10 to 25 cents to their values. Growers warmed to these new price levels, clearing over 98%.

Skirtings followed the lead of the fleece room: the sub 18 micron, <5% VM better types keenly sought after as rises of 40 to 60 cents were common with some finer lots <17 micron up to 100 cents higher with the burrier, broader types 10 to 25 cents to the good. Again the sell rate was over 98%. Cardings also had a good sale as all types in this sector were solid to 20 cents higher as the records set 3 weeks ago will come under threat next week. At long last some XB types finally had a positive sale, 24 to 28 micron up 5 to 20 cents with the broader microns, as mentioned, cheaper along with carbonising types, almost unsaleable at the processing end thus almost unwanted in the sale room.

Again a good week for merino growers as 19 and finer continue to improve to acceptable levels, finer than 18 now all above 2000 cents clean but still, as mentioned last week, 50 to 300 cents from the winter peaks of 2011. The gap from 21 to 18 micron now 550 cents, about where it should be, while 18 to 16.5 just an 85 cent difference. The “back legs out” debate touched on in last report is an interesting issue. We had an excellent example of hind legs out of fleece lines this week from Nyngan. Fleece averaged 4.2% VM, 970c/kg while the back legs had 12% VM to sell for 730 cents. We think with the back legs in the fleece lines VM rises up to 7/8% and prices back to low 800 cent range but it’s a case by case situation as to make a back leg line or not. Next week’s catalogue climbs to 47,500 bales. Current sentiment suggests there is quite a bit of covering and forward buying still outstanding to see the market solid at the very least.

Ag Concepts Fwd Prices at 10 February 2017

Main Buyers (This Week) 

WEEKLY MARKET REPORT

Week Ending 3^rd February, 2017

AWEX Northern Micron Indices Comparison

the trend continues

Another week of the split market being very apparent. Low VM, better testing wools, particularly finer than 19 micron, saw further increases and very strong support mainly from China. The positive aspect this week was a consolidation of prices for the types outside the strong demand areas of recent weeks like burry fleece types and broad merino wools. These types were heavily dominated by only a few buyers but were no cheaper than last week and it looks like they may have found a level. Certainly once the VM goes above 6% (as many of the fleece lines are) clean prices for the fleece lines are only around 100 cents better than the skirtings taken off them. Some classers are now double-skirting to remove the hind legs and there will be cases where that will pay dividends but it is a case by case scenario. With the finer clips it definitely is worth it but at the broader end it may not be the case as the hind legs themselves will test a lot broader and not attract great support.

At the finer end it was onward and upward, particularly for the well spec’d lines as choosy buyers pushed the better lines well above the indicator averages by up to 50 cents.

Whilst it is very exciting to see this demand at the finer end push prices to reasonable levels, it is by no means making new territory. A quick glance at the June, 2011, market reveals the 17 micron indicator 335 cents higher than this week and this was at a time when the Australian dollar was at 105.5 US cents!

Skirtings and merino cardings held reasonably well with minor movements either way whilst crossbreds still fail to perform and languish well behind levels of last year, particularly 28 and coarser. As mentioned in recent reports the crossbred burry oddments are at ridiculously low levels not seen in years.

Of interest to anyone dodging the heat next Sunday will be a feature on the Chinese wool market aired at noon on Landline on ABC TV.

Next week sees an increase in the offering to nearly 46,000 bales in three centres as Macwool lines up on Wednesday.

Ag Concepts Fwd Prices at 3 February 2017

Main Buyers (This Week) 

WEEKLY MARKET REPORT

Week Ending 27^th January, 2017

AWEX Northern Micron Indices Comparison

Looks like The dust has settled.

It was another week of two halves, but this time the two days each had a different tone about them. Not surprisingly, the first day of selling was met with buyer resistance as the dollar edged higher and the offering consisted of more broader merino types carrying higher VM. The Northern Indicator fell 20 cents on Tuesday with the majority of the pain felt coarser than 20 microns. On Wednesday the market held firm and even strengthened towards the end of selling indicating the “correction” was over for the time being. Interestingly though, the broader end continued to ease with 22 microns quoted back another 20 cents on the second day.

The weekly change column shows a clear direction for the market which has been quite marked since the resumption of sales three weeks ago. What the market reports don’t show are the discounts and quotes for wool carrying high levels of VM e.g. fleece over 4%. About one third of our merino fleece offering this week was carrying over 4%, and up to 11%. In the three weeks since sales resumed the discounts for these types has nearly doubled as processors grapple with what to do with them. Conversely, the skirtings off these same clips which are carrying from 15-25% haven’t changed much and are making relatively good money in clean terms. We expect this trend to continue over the next few months as most clips will edge higher in micron and wool cut.

Merino cardings have maintained values reasonably well as small volumes in this sector keep buyers on their toes, crossbred oddments on the other hand have been struggling for some time and much of the passed lots we have had during the last three weeks have been these types.

For fine wool, the future looks very bright as supply will tighten over the coming months. One thing to consider as autumn approaches will be seed and shive. Any seedy edges would be best removed as discounts on these types will definitely increase as we have seen with clover burr.

Next week it is expected that the firming trend seen on Wednesday will continue and the offering of 42,500 bales is lower than any of the previous three weeks with Macwool first up on Thursday.

Ag Concepts Fwd Prices at 20 January 2017

Main Buyers (This Week)

WEEKLY MARKET REPORT

Week Ending 20^th January, 2017

AWEX Northern Micron Indices Comparison

TWO MARKETS IN ONE!

A vastly different market greeted growers this sale when compared to last week’s auction. When looking at the AWEX weekly report, a rise of 12 cents for the EMI to 1434 (a new record since AWEX took on market reporting way back in 1993) looks to be good but it was a market going in two different directions.

Again, it was the finer microns leading the way with <18.5 microns 55 to 85 cents higher despite a 5 to 25 cent fall on the final auction day. The 19 to 19.5s lifted by 10 to 30 cents but that’s where the good news ended as 20s and broader gave up 5 to 20 cents from last weeks  high.  The ever-increasing volume of higher VM took its toll as these fleece types (above 4% VM-19 micron and broader) were 50 to 100 cents cheaper than last week.

Skirtings looked to be the best performing sector of all. Buyers focused on the sub 18 microns, best style <5% VM pushing these up by 20 cents for 18s to 70/110 cents for 17 and finer. One particular clip from Orange averaged $1885/bale for skirtings and cardings (including dags) incredible money!! Cardings also held their nerve as finer than 18 micron across all types were quoted up to 10 cents dearer while broader lots looked fully firm. To highlight this, a burry clip from Tilpa saw its locks make 699 whilst its top fleece price was only 50 cents higher! This example of LKS/CRS being 2^nd top price in burry clips will not be too uncommon.

Crossbreds had a mixed sale as a final day recovery saw 25 and 28 micron in the sellers’ favour as all other microns lost 5 to 40 cents with some carding and carbo types (above 15% VM) virtually unwanted as the pain could drag on in this sector for a while

Whilst the headlines in The Land herald record wool prices, and recent gains are certainly welcome, general prices are not in record territory. Whilst we have to go back a long way, fine wool prices have certainly been a lot higher several times over the last 30 years. What we do see happening as the seasonal conditions from last winter onwards convert to greasy wool, a gradual increase in micron and much more vegetable matter in fresh shorn wool. As yet the bulk of the VM has been trefoil but seed and shive will really test the strength of the market. The two halves we saw this week coincided with the increase in burry broader merino types. Put simply, fine and free should continue unabated whilst broad and burry may have hit some resistance. Discounts for the higher VM lines (up around 8-10%) opened out to close to 200 cents clean this week. None of these types are included in the market report micron indices.  So whilst they can crow about a record indicator level, they are not reporting a fair chunk of the wool sold!  Next week just over 47,000 bales down from 56,000 bales should help. We sell Tuesday with 800 bales.

Ag Concepts Fwd Prices at 20 January 2017

Main Buyers (This Week) 

WEEKLY MARKET REPORT

Week Ending 13^th January, 2017

AWEX Northern Micron Indices Comparison

A LATE CHRISTMAS PRESENT!

The market exploded into action at this week’s resumption from a well earned 3 week Christmas recess.  Even as far back as the Friday before Christmas, the opening week of the recess, business had been brisk (to say the least) with plenty of wool being booked up and far more enquiry than local traders can remember in a sale recess for quite some time.  Concerns of a drop off in supply and increasing demand coupled with the $A falling below 72 cents and the 3 week recess, forced exporters to start the year off with buying vigour not seen for a long time. Talk of the market opening up to 50 cents dearer was spot on in Melbourne on Tuesday, the gains in the order of 35 to 75 cents. This momentum continued on in earnest on Wednesday and Thursday. By week’s end <18 micron saw climbs of 130 to 165 cents. 21 to 18.5s benefitted by 80 to 110 cents while 22s and broader up by 50-60 cents. The EMI posted a 67 cent jump to 1422 and a 56 cent lift in $US terms to 1056. Just 34 bales of fleece were passed-in in Sydney, clearing 99.4%.

Skirtings were also caught up in the price hike of their fleece counterparts. Finer lots <19 micron containing <5% VM were quoted 80 to 120 cents higher with the medium types with over 5%VM adding 60-70 cents to their pre Christmas values with 9 lots of “BKN” making  1050 to 1246 cents. Cardings were also caught up in the big price rises with all types in this sector 30-40 cents to the good. The 3 carding indicators range from 1163 to 1171, now into record territory.  We had “CRT” make over 1000 cents and “LKS” from the same clip 828 cents. The Crossbred sector was stagnant, 25 to 28 and 32 micron in sellers’ favour with 30 micron down by 20 cents with most commentary on this sector predicting more pain to come before any sort of recovery at least 6-12 months away.

A great sale to be in if you’re offering Merino wool but still not so good for Crossbred growers. Bidding at times was frantic and at times “buy at best” was the only option buyers looked to have up their sleeve. The EMI, at 1422, is at its highest level since June 2011 - five and a half years ago and now only 3 cents shy of that peak. Good news for fine-wool growers as the recovery for finer, <19 micron continues as fine, long wool types are back in vogue. The gap continues to widen between fine and broad microns - 238 cents from 21 to 19s and a 274 cent gap from 20s to 18 micron.  55,000 bales are on offer next week but keen demand should see the trade absorb this quantity without too much trouble. We sell late in Thursday with 1465 bales on offer.

Ag Concepts Fwd Prices at 13 January 2017

Main Buyers (This Week) 

WEEKLY MARKET REPORT

Week Ending 16^th December, 2016

AWEX Northern Micron Indices Comparison

A SOLID FINISH. MERRY CHRISTMAS & A HAPPY NEW YEAR!!

More than 55,000 bales were offered this week - the largest national total since January and the final sale of the 2016 calendar year. Unlike in recent weeks where the market has been subject to large price increases or corrections, Wk 24 saw a gradual increase in prices across all centres on all selling days, although most price increases were experienced during Wednesday’s selling. After steady price rises throughout the sale all merino sectors generally finished the week 10 to 20 cents above levels recorded in the previous sale. A pleasing aspect were the culprits (off style, lower types) that dragged the market back last sale which were in higher demand than their more fancied counterparts, dearer by 40 cents.

The skirting market performed better than the fleece in Sydney and Fremantle (on average 20 cents dearer for the week) while Melbourne was firm unchanged compared to the previous week. It was the largest offering of Crossbreds in 2 years and 34% larger than last week. Prices drifted lower and poorly prepared lots, in particular, were neglected then increasingly discounted as the sale progressed. Prices were generally discounted between 5 and 20 cents with the coarser end least affected. The oddment market was one of small mixed movements. Small price rises and increases saw an average decrease of 5 cents in the Eastern Merino Carding Indicators and a 2 cent increase in the Western Region, all 3 centres MCIs now within 4 cents of each other - 1131 to 1134.

A good finish to the year considering the increased volume over the past 4 sales contributing to a 55,000 bale increase in wool offered to date YOY. The continued good demand for merino combing wool and the favourable exchange rate helped the merino sector finish on a good note. The same can’t be said for crossbreds. They lurch from bad to worse with several broad burry types virtually neglected. Any sign of improvement seems a long way off.    

The EMI finished the 2016 calendar year 90 cents higher (+7.1% YOY) at 1355 cents - the highest ‘calendar year’ closing figure on record. Turnover for 2016 was just over 2.5 billion dollars (AUD) - the largest amount since 2002 (2.9 billion during that year when volume was 62% higher). Average dollars per bale in 2016 (excl. NZ) was $1478, the highest on the AWEX database (since ’97).

Sales resume on the week beginning the 9th January, 2017, with selling in Sydney, Melbourne and Fremantle with an expected catalogue of 55,000 bales. Merry Christmas and a safe and Happy New Year to all our clients!

Ag Concepts Fwd Prices at 16 December 2016

Main Buyers (This Week) 

WEEKLY MARKET REPORT

Week Ending 9^th December, 2016

AWEX Northern Micron Indices Comparison

BUYERS EXACT REVENGE!

The market went in all directions - up, down and sideways. The subtle drop in prices in Fremantle last Thursday was just a precursor to what was to unfold this week. With volumes exploding this and next week, buyers took their foot off the accelerator from the get-go. From the outset in Melbourne on Tuesday the market came back to earth with a thud. As Sydney and Fremantle joined in on the 2^nd day, those 2 centres fell to Melbourne’s levels that actually sold to sellers’ favour. The final day saw a consolidation of up to 15 cents to finish the sale on a firming note. By week’s end all microns gave up 30 to 50 cents with “off types” and lots outside specs neglected to fall up to 100 cents. Even with the big drop in prices some lots with up to 2.4% VM and a bit over-long (110mm) just to name a few, made 25 to 70 cents above their indicators.

Skirtings also felt the full force of price reductions, large falls to open proceedings followed by a final session recovery. Across all types and descriptions, regardless of VM, losses ranged from 40 to 50 cents. To everyone’s surprise the largest crossbred catalogue since January (23% of the eastern seaboard offering) performed the best of any sector. Finer types <28 were up to10 cheaper while 30s and broader lifted by 20 cents. Cardings also seemed to be less affected than their merino combing wool counterparts. Locks were the main culprit giving up 15/25 cents while STNS and CRT remained solid all week.

The EMI lost 29 cents to 1349 - its largest weekly fall since early November (28 cents) wiping out 30% of the past 3 week’s gains. In $US terms the loss equated to just 9 cents - now 1012 - due to the strengthening $A. The spike in volume following the “bull run” over the past month; this week’s sale blowing out by 18% from estimates 2 weeks ago; and some outstanding orders finished coupled with a rise in the A$ all conspired to this sale’s correction. The extent of the opening day’s fall in Melbourne (25 to 65 cents) took everyone by surprise as talk on the showfloor was in the range of 20/30 cents. As one buyer put it, half of the fall was due to “local exporters panicking”, not a full pull-back in price by the Chinese as they are “still desperate for wool”.

Next week will be the final sale before the 3 week Christmas recess. The anticipated catalogue of 56,000 bales is the largest since mid January but, coming off a slight recovery on Thursday and futures out to February, 2017, are 10 cents dearer than the physical price, there may be enough demand about to soak up the extra 20% in volume from estimates early last week.

Ag Concepts Fwd Prices at 9 December 2016

Main Buyers (This Week) 

WEEKLY MARKET REPORT

Week Ending 2^nd December, 2016

AWEX Northern Micron Indices Comparison

NEXT FORTNIGHT’S VOLUME WILL DICTATE MARKET DIRECTION

The market continued on its merry way albeit at a steadier pace despite prices stalling late on Thursday. The AWEX EMI posted a 15 cent gain to 1378 (a 5 year high). The rise was similar in $US terms (17 cents to 1021). Buyer focus was on the excellent superfine selection in the last “designated superfine” sale of the year. 18.5 and finer lifted by 35 to 65 cents and, in some cases, up to 300 cents for the absolute crackers. The medium types (19 to 21s) were 5 to 20 cents better.

Skirtings continued to forge ahead <18 micron up to 4% VM added 50 to 70 cents with some isolated types dearer by 100 cents while 19s and broader (regardless of burr content) gained 20 cents. Cardings improved: all types in this sector 15/20 cents to the good and nearing January’s 10 year record level. Crossbreds look to have bottomed out as most indicators added 5 to 15 cents, bar 26 to 28s these finishing flat to buyers’ favour.

The market’s run has now extended to 10 days as the EMI has climbed 95 cents in that period - 1283 to 1378. Since the US election it has been a dramatic turn around when the market gave up 48 cents in the week before the election. Despite the rising market the pass-in rate climbed to 6.2% (the largest in 3 sales) this probably due to crossbred growers taking a stance against these levels and some superfine growers setting their sights too high. The recovery in the superfine sector has been a long time coming. The gap from 18 to 21 micron is now 300 cents, about where it should be and above the 10 year average of 250 cents, as prices for <18.5 get back to levels which are profitable.

Future’s trading was brisk early in the week with 113.5 tonne traded as far out to January, 2018 (19 mic @1510 for 5000kgs). The market may have reached a peak for the time being. The fall in Fremantle’s Indicator of 6 cents on Thursday could be a sign that buying urgency has slowed as the next 2 sales should see the anticipated offering of well over 50,000 bales each week giving them plenty of wool to pick from. Quantities have obviously become larger due to the rising market as some growers with wool on “hold” offer their wool to cash in on these good levels. Also adding to the quantity was AWTA November figures released, up a whopping 21% from a year ago as dry weather prevailed allowing shearing to catch up. Issues have emerged around the Chinese annual CSQ (country specific quota) as many mills are fulfilling this year’s quota. Year–on-year demand is better as prices are 10% higher in an offered volume of 1^st hand wool that is >6.2% as the demand is coming from the recovering weaving sector that requires longer (fleece) types.

Ag Concepts Fwd Prices at 2 December 2016

Main Buyers (This Week)