Weekly Market Reports


3 May 2019

Friday, May 03, 2019

 WEEKLY MARKET REPORT 

Week Ending 3rd May, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S44/18

This Week

M44/18

Last Sale

S42/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2493

2390

2483

+10

2752n

-259

18

2425

2375

2404

+21

2345

+80

19

2304

2306

2291

+13

2086

+218

20

2278

2271

2264n

+14

1980

+392

21

2265n

2260

2238 (M)

+22 (M)

1964

+301

26

1515n

1511n

1450n

+65

1341n

+174

28

1303n

1308

1244

+59

998

+305

30

-

1005n

976 (M)

+29 (M)

706 (M)

+299 (M)

MC

1094

1082n

1084

+10

1377

-283

MOMENTUM BUILDING!

Wool sales recommenced this week following the Easter/ANZAC day holidays. After the market’s solid performance at the Easter Show hopes were high that the market had finally bottomed out and recovery was under way. The few buyers that were pre-valuing last Friday reported a bit of business being written and some mills being caught short for wool to process and the depreciation of the FRX by 1.5 cents also assisting any thoughts of ramping up purchasing patterns. The opening session saw 80% of the fleece selection in the good/best topmaking style (4/5) to see increases of up to 30 cents that lasted through to the final lots on the closing day. The AWEX EMI increased by 17 cents to 1960 but, as the A$ strengthened, this saw the market retreat in US$ terms - back by 21 cents to 1376. Most increases came in the good/best topmaking style types with the ever growing volume of poorer style wools losing ground to their superior counterparts - the gap between the good and inferior types widening.

Skirtings also benefitted from the renewed support as all descriptions lifted by 15 to 25 cents. Cardings shock off the run of falls to average 15 cent rises across the 3 centres. Crossbreds continued on their record breaking run as most microns jumped by 10 to 65 cents. This has a good 28 micron fleece type making 850 to 950 cents greasy and 26s over 1000 cents - incredible money!!

Talk of the market rising was spot on. Despite the national volume lifting to 43,000 bales (due to the 1 week recess) the extra wool was well absorbed by the buyers even with the absence of 2 of China’s largest indent buyers. Diminishing quantities over the next 3 sales (averaging 32,000 bales/week), the favourable FRX and fresh business being written all augurs well for a solid to dearer market for the immediate future.    

As is the case at the end of every month, latest AWTA figures were released. They showed a sharp decline in wool tested this April compared to 12 months ago 10%. The progressive total for the season was the same coming in at 10% less as offerings are just shy of 200,000 bales less than last season to date. The national catalogue drops back to 33,000 bales next week. If the Chinese indent buyers re-enter the market, price rises could be in the range of what was discussed earlier this week on the showfloor. Hope you are all getting the rain. 

Ag Concepts Fwd Prices as at 3 May, 2019

Micron

Date

Low

High

21

19-Jun-19

2250

2250

21

09-Oct-19

2125

2125

Main Buyers (This Week)

1

Techwool

6273

2

Tianyu Wool

5280

3

Fox & Lillie

3729

4

Aust. Merino

3250

5

PJ Morris

2656

6

Endeavour Wool

2530


Eastern Market Indicators (AUD cents/kg clean)

1960 cents é 17 cents compared with 18/04/2019


Northern Market Indicators (AUD cents/kg clean)

1997cents é 18 cent compared with 18/04/2019


AUD/USD Currency Exchange

0.7021 ê 0.0172 compared with 18/04/2019

18 April 2019

Thursday, April 18, 2019

 WEEKLY MARKET REPORT 

Week Ending 18th April, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S42/18

This Week

M42/18

Last Sale

S41/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2483

2358n

2497

-14

2768n

-285

18

2404

2355

2410

-6

2355

+49

19

2291

2291

2293

-2

2088

+203

20

2264n

2255

2272

-8

1981

+283

21

-

2238

2238n (M)

0 (M)

1951 (M)

+287 (M)

26

1450n

1501n

-

+41 (M)

1247

+203

28

1244

1266

1205n

+39

926

+318

30

-

976

-

-22 (M)

688 (M)

+288 (M)

MC

1084

1072n

1096

-12

1368n

-284

MARKET FINALLY SETTLES!

The wool sale was held at the Royal Easter Show this week and had an overall positive tone to finish this run of sales before the 1 week recess for Easter and ANZAC Day. The AWEX EMI posted a 7 cent increase due mainly to Melbourne’s momentum, up 11 cents, compared to the 1 cent rise in Sydney.  The Sydney market opened on a solid note only to see sub 18 micron fade late in the final session to end the sale 5 to 15 cents cheaper and broader types either side of unchanged by 5 cents. Again buying strategies were a mirror image of previous sales - good types with the right specs were in hot demand as the vast quantity of poorer types were cheaper dragging the indicators lower.

Skirtings made little inroads into their run of falls over the past month as the best style lots lifted by 10/20 cents while all other types were firm. The carding market continued to fall with LKS losing 15 to 30 cents as all other descriptions remained unchanged. The appetite for XB wool seems insatiable at the moment as more records were set for 28/30 microns - rises ranged from 20 to 40 cents.

The market finally put the brakes on the long run of falls, 7 weeks and 91 cents, the longest falling run since late 2003. While this run of falls is disappointing, it was preceded by an 8 week run of increases that started in the final sale of 2018 and the gain was 178 cents, so still an indicator that is 87 cents to the good since December.

More news to come out of the IWTO Conference: Giovanni Schneider (MD of the Schneider Group) gave an update of the wool textile industry in Italy. Wool makes up just 1% of global consumption of fibres. Italy accounted for 11% of fibre used in their textile industry (men’s knitwear). Conditions in the worsted weaving business were difficult with manufacturers and retailers holding excess stocks of suits and a major challenge for the industry worldwide was the ever increasing demand from consumers for sustainable products. Another presentation on the British wool market highlighted the low prices for > 32 micron wool which are now very competitive compared to nylon. Brexit would not affect the price of wool but the British Wool Marketing Board has started a new marketing campaign to lift grower returns. Wool sales recommence on 1st May. 

Main Buyers (This Week)

1

Techwool

4123

2

Tianyu Wool

4039

3

Fox & Lillie

3143

4

Aust. Merino

3031

5

Seatech Ind.

2824

6

Endeavour Wool

2711


Eastern Market Indicators (AUD cents/kg clean)

1943 cents é 7 cents compared with 12/04/2019


Northern Market Indicators (AUD cents/kg clean)

1979cents é 1 cent compared with 12/04/2019


AUD/USD Currency Exchange

0.7193 é 0.0030 compared with 12/04/2019

12 April 2019

Friday, April 12, 2019

WEEKLY MARKET REPORT 

Week Ending 12th April, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S41/18

This Week

M41/18

Last Sale

S40/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2497

2375n

2512

-15

2763

-266

18

2410

2334

2422

-12

2293

+117

19

2293

2271

2299

-6

2037

+256

20

2272

2238

2277

-5

1929

+343

21

2264n

2238

2268n

-4

1893

+371

26

-

1460n

1445n

+2 (M)

1204n (M)

+256 (M)

28

1205n

1268

1205n

0

899

+369

30

-

998

-

+35 (M)

638 (M)

+360 (M)

MC

1096

1100

1101

-5

1352n

-256

A HAPPY EASTER SHOW SALE!!

Once again the wool market was in a virtual holding pattern as the AWEX EMI slipped by another 7 cents to 1936. Small decreases were the order of the day in the fleece sector as 18.5 and broader finished in buyers’ favour (-5) as 18s and finer gave up 10 to 15 cents. The falls in the other 2 centres were heavier: Melbourne’s losses ranged from 5 to 45 cents while Fremantle’s fleece indicators fell 25 to 40 cents as the inferior types bore the brunt of the negative buyer tone with the better style wools with good specs holding their ground - this being the purchasing pattern for a number of sales now.

Skirtings had a tough opening day as losses ranged from 20 to 50 cents depending on VM, style and length but held these levels in the final session. Cardings had a less tumultuous sale than the previous few series as just LKS gave up another 10/15 cents. All 3 MCIs are now within 4 cents of each other, 1096 to 1100. Crossbreds again were the star of the show as increases ranged from 25 to 65 cents.

The 88th IWTO conference was held this week in Venice, Italy with the theme of “Wool in Excellence” as 300 delegates were in attendance. Italy is home to the world’s best textiles even though they purchase just 5% of our clip when it is processed into garments and textiles, turn over is more in value than the entire Australian wool clip. Constant discussion also centred on traceability and sustainability with many references to mulesing in between. The big message to take home is the National Wool Declaration and its critical importance and the need to have 100% of wool declared. AWI (Don) presented a short film on the drought that captured everyone’s attention and you could’ve heard a pin drop. This film featured 3 of our clients and how they are managing their sheep and country and was very much appreciated by the non Australian audience who have been hearing so much about the drought but had no visual idea of its severity on the land, livestock and people and the shrinking supply of wool. The Macwool Facebook page has had over 37,000 views of the film to date. To have a look search “Australian wool supply continues despite drought” on Facebook or YouTube.

Wool sales move to the Easter Show next week before the 1 week recess, let’s hope the market can improve.

Ag Concepts Fwd Prices as at 12 April, 2019

Micron

Date

Low

High

21

26-Jun-19

2250

2250


Main Buyers (This Week)

1

Seatech Ind.

3414

2

Fox & Lillie

3236

3

Techwool

3047

4

Aust. Merino

3022

5

Tianyu Wool

2842

6

Endeavour Wool

2016

Eastern Market Indicators (AUD cents/kg clean)

1936 cents ê 7 cents compared with 05/04/2019

Northern Market Indicators (AUD cents/kg clean)

1978 cents ê 8 cents compared with 05/04/2019

AUD/USD Currency Exchange

0.7163 é 0.0045 compared with 05/04/2019

5 April 2019

Friday, April 05, 2019

WEEKLY MARKET REPORT 

Week Ending 5th April, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S40/18

This Week

M40/18

Last Sale

S39/18

Sydney

Change

Last Year

Sydney (W39)

Sydney Yearly

Change

17

2512

2415n

2513

-1

2764

-252

18

2422

2365

2437

-15

2301

+121

19

2299

2290

2316

-17

2037

+262

20

2277

2253n

2293

-16

1922

+355

21

2268n

2253n

2279n

-11

1888

+380

26

1445n

1458n

1425n

+20

1198 (M)

+260 (M)

28

1205n

1203n

1178

+25 (M)

859

+346

30

-

963n

945

+18 (M)

614 (M)

+349 (M)

MC

1101

1117n

1142

-41

1332

-231

SAME OLD, SAME OLD!!

The pattern of the last series kept going this sale as a minute fall of 4 cents for the AWEX EMI to 1943 was the end result. This was the 6th sale in a row that saw a negative tone, the longest downward spiral (84 cents) since September 2012. The FRX was generally stable and has been trading in the range of 70.50 to 71.50 for 8 weeks. The MPGs had small losses, 17 micron and finer in buyers’ favour and broader than this lost 10 to 15 cents. As has been the case for several sales now fine, dusty, tender types bore the brunt of the falls while the good spec wools were rock solid. The volume of “best topmaking” fleece types was only 19% of the 21,500 bales on offer nationally with this figure down to 27% year to date compared to 43% the previous season illustrating just how much the drought is affecting the quality of the offering especially on the eastern seaboard.   

Skirtings also continued their cheaper trend as, like the fleece sector, only the very best fine micron, low VM types remained unchanged as the burrier, broader lots were 20 to 40 cheaper. Cardings fell again as the MCI in Sydney has given up 137 cents in the last 3 sales (1238 to 1101) as losses ranged from 20 to 60 cents for all descriptions in this sector. The only shining light was the Crossbred sector. Its stellar run since Christmas carried most microns to new record levels again adding 10 to 20 cents. From 25 to 32 microns increases have ranged from 185 to 350 cents since sale recommenced in January.

Talk of the market bottoming out over the past fortnight is yet to come to fruition. Exporters are still to find a comfortable level to trade the huge volume of drought affected wool that has and will continue to hit the market for a long time yet. While the merino types struggle XBs remain the flovour of the month as the above-mentioned figures show as more and more blending takes place between the 2 breeds as a means to cheapen up the final product. March testing figures from AWTA show little change in volumes as 3.7% less wool was tested this March compared to 2018. The progressive total for weight tested this season compared to the previous is 10.3% less - down from the June to December figure of 12%. If this status quo remains in play till June, 2019, this will give us 323mkg for the season which is well above the 308/312mkg estimate of last September. Export weight is tipped to be 2.45% less than last season as the average clip yield has fallen from 65 to 63% due obviously to the worsening quality of the clip as less clean kgs are exported. Well done to those clients who were lucky enough to be under last Friday’s storms, 65 to 110mm. Hopefully the next round of rain is more widespread and here soon. Market must be close to bottoming out soon, next week maybe???

Main Buyers (This Week)

1

Fox & Lillie

3674

2

Seatech Ind.

3337

3

Techwool

3126

4

Aust. Merino

2806

5

Tianyu Wool

2685

6

Endeavour Wool

2668

Eastern Market Indicators (AUD cents/kg clean)

1943 cents ê 4 cents compared with 29/03/2019

Northern Market Indicators (AUD cents/kg clean)

1986 cents ê 7 cents compared with 29/03/2019

AUD/USD Currency Exchange

0.7118 é 0.0021 compared with 29/03/2019

29 March 2019

Friday, March 29, 2019

 WEEKLY MARKET REPORT 

Week Ending 29th March, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S39/18

This Week

M39/18

Last Sale

S38/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2513

2447

2538

-25

2764

-251

18

2437

2359

2457

-20

2301

+136

19

2316

2296

2331

-15

2037

+279

20

2293

2274

2298

-5

1922

+371

21

2279n

2263

2283n

-4

1888

+391

26

1425n

1433n

1408n

+17

1198 (M)

+227 (M)

28

-

1178

1165n

+19 (M)

871 (M)

+307 (M)

30

-

945

-

+16 (M)

614 (M)

+331 (M)

MC

1142

1109n

1172

-30

1332

-190

A TALE OF TWO SALES!!

Week 39 saw 37,400 bales go to auction, 5700 less than last week. Unfortunately there was another decline in the Australian wool market (even with the 7.5% drop in supply) which saw 11.8% passed in. The AWEX EMI came back for the fifth consecutive week closing at 1947, a decrease of 16. There were considerable discounts once again this week, especially on the lower yielding wools, under 60%, which made up 30% of the merino fleece nationally by week. A report from AWEX explains that this week was the highest percent of low yielding wools since the 2009 drought. This is definitely a driving factor at the moment as lower yields mean extra processing, extra cost and more chance of damaged valuable fibre. As we look into the future, even if we get this rain that has confidently been predicted this weekend, (all fingers crossed) buyers and processors realise there is going to be a lot more of these types of wool coming through the system for a good length of time yet. As quoted by AWI, “With most of our wool destined for export in the greasy form, the low yield means far less clean kgs are able to be placed into shipping parcels/containers. Container shipment to China is much cheaper than all other destinations so decreased shipping of clean kgs is problematic but relatively negligible in the big cost/picture but with the European and Indian shipping costs ranging from 3 to 5 times higher, the lower yields either take competition away or depress prices due to conversion to clean kg.” Another factor included in the decreasing value of our wool is the constant flow of high mid-break wools. This week saw 76.8% of the Australian merino fleece under 40 nkt. Any better style wools with low VM, sound and higher yields are definitely making a premium in the merino fleece market which is still strong.

Merino skirtings had another solid week. Buyers seemed enthusiastic as the auction kicked off and left the skirtings generally unchanged, still helping the average for woolgrowers. The downside for the room 2 wools was the Cardings giving up 30 - 42c nationwide but still closing at an average of 1113c/kg.

Definitely on the positive side once again the XBs have added to the indicators. Very strong buyer support has helped the XBs rise by 15 to 20 cents with the broader 32 microns taking the biggest leap.

Next week sees us taking 814 bales to the auction. Let’s hope the market heads in a positive direction and see the EMI break back through the 2000 mark!

            Ag Concepts Fwd Prices as at 29 March 2019               

Micron

Date

Low

High

21 17-Apr-19 2250 2250 
21 9-Oct-19  2095 2095 

Main Buyers (This Week)

1

Techwool

4990

2

Fox & Lillie

4000

3

Seatech Ind.

3511

4

Aust. Merino

2865

5

PJ Morris Wool

2311

6

Tianyu Wool

2198

Eastern Market Indicators (AUD cents/kg clean)

1947 cents ê 16 cents compared with 22/03/2019

Northern Market Indicators (AUD cents/kg clean)

1993cents ê 14 cents compared with 22/03/2019

AUD/USD Currency Exchange

0.7097 ê 0.0048 compared with 22/03/2019

22 March 2019

Friday, March 22, 2019

WEEKLY MARKET REPORT 

Week Ending 22nd March, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S38/18

This Week

M38/18

Last Sale

S37/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2538

2458

2560

-22

2776

-238

18

2457

2383

2472

-15

2348

+109

19

2331

2317

2340

-9

2074

+257

20

2298

2282

2309

-11

1960

+338

21

2283n

2282

2291n

-8

1914n

+369

26

1408n

-

1411n

-3

1168

+240

28

1165n

1159

1141 (M)

+18 (M)

842

+323

30

-

929

921 (M)

+8 (M)

595 (M)

+334 (M)

MC

1172

1151n

1238

-66

1330n

-158

CROSSBREDS SOLID - MERINOS FALL!

Another week and more falls for the wool market. For the 4th sale in a row the market was in retreat as all of the advances of S34 (59 cents) amidst the SA foot and mouth outbreak have been eroded as the AWEX EMI lost another 16 cents to add to the 48 cent losses for the 3 previous sales. The only sector to escape any losses was XBs. The ascending A$, peaking at 71.5 cents, a lift of 1.22% coupled with the ongoing poor selection gave buyers enough ammunition to let the market drift as 18 micron and broader gave up 10/15 cents while < 18s fell by 25 cents with only the very best style fleece wools with high nk/t readings and low mid-breaks escaping any discounts. The fleece offering that came under a style 6 or 7 (average to inferior topmaking styles) made up 15% of the volume, the highest weekly level since June 2010 as the grip of drought seems to tighten up.

Most room 2 types fared worse than their merino fleece counterparts. Skirtings took hits of 30/50 cents for the low VM lots (<2%) with burrier, poorer style types giving back 80 cents. Cardings also took a major hit as LKS/STN lost 40 to 70 cents while STN collapsed by 10 to 120 cents. As mentioned earlier, the XB sector was the only one to go through the sale unscathed as most microns were solid to 20 cents dearer.

All the talk on the showfloor centres around the selection and how poor it is with no real improvement in the short term even if the drought were to break now. Some fleece lines are yielding below 50% with these becoming an issue in scouring as water replacement frequency increases and sludge disposal costs escalate. There are no issues further down the processing line if scouring is effective as topmakers can use these wools and take advantage of the price discounts as the finished product is still suitable for worsted yarn manufactures.

National volumes look to have stagnated around the 40,000 bale/week mark as many growers shear and offload sheep to escape what could be another tough winter as low finances and ability to source supplement feed is forcing growers into this dire situation of selling ewes. Quantities are expected to decrease rapidly after Easter. The market looks to be close to the bottom of this price cycle according to some buyers. Let’s hope so and pray that “Trevor & Veronica” can get together and deliver what so many desperately need - a massive rain event!!

            Ag Concepts Fwd Prices as at 22 March 2019               

Micron

Date

Low

High

21 27-Mar-19 2260 2260 

Main Buyers (This Week)

1

Techwool

4749

2

Tianyu Wool

4248

3

Fox & Lillie

3619

4

Seatech Ind.

3534

5

Kathaytex

2671

6

Endeavour Wool

2605

Eastern Market Indicators (AUD cents/kg clean)

1963 cents ê 16 cents compared with 15/03/2019

Northern Market Indicators (AUD cents/kg clean)

2007cents ê 20 cents compared with 15/03/2019

AUD/USD Currency Exchange

0.7145 é 0.0085 compared with 15/03/2019

15 March 2019

Friday, March 15, 2019

 WEEKLY MARKET REPORT 

Week Ending 15th March, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S37/18

This Week

M37/18

Last Sale

S36/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2560

2445

2608

-48

2746n

-186

18

2472

2375

2520

-48

2328

+144

19

2340

2326

2381

-41

2027

+313

20

2309

2292

2340

-31

1912

+397

21

2291n

2277

2321

-30

1854

+437

26

1411n

-

1451n

-40

1153

+258

28

-

1141

1169n

-24 (M)

815 (M)

+326 (M)

30

-

921

945 (M)

-24 (M)

563 (M)

+358 (M)

MC

1238

1184n

1237

+1

1298n

-60

UNDER THE WEIGHT OF DUST!

It was another tough week as the EMI slipped for the third week in a row under the weight of an increasing catalogue of drought-affected dusty wools and back under the magical 2000 cent mark to finish 29 cents lower at 1979. The national average yield on merino fleece this week was 63.6%, the lowest in ten years.

Over the course of the week buyers continually adjusted downwards their limits on the low yielding types as they struggled to average them into their orders. On the other hand, the few well-measured lines for both yield and tensile strength saw very good competition and finished the week not far below the previous week. It seems this trend will continue for the foreseeable future and now is certainly the time to be pulling dusty backs out of fleeces to give the remainder a fighting chance. What is also set to continue will be the downward pressure on the sub 19 micron sector and we now see the 17 micron indices 186 cents below this time last year even though the EMI is 228 cents above last year’s level. We predict the gap to narrow over the coming months with an imbalance in offering squeezing the broader end and flooding the fine end.

The Foot and Mouth outbreak in South Africa could still be having an impact here but not positive. We did see a jump in the market three or four weeks back and some of that rise was attributable to the Chinese ban on SA wools. The downside is that there are exporters who have South African wool tied up in containers either at Chinese ports, on the water or still in SA awaiting a clearance, who also buy wool off us. These exporters (a couple of large ones) would be feeling a credit squeeze and this has the potential to impact our market here. South Africa produces about 50mkg per annum equivalent to about 14% of the Australian clip. The fall in production here this year will be close to the entire SA wool clip.

Next week a larger catalogue of 44,000 bales will be offered in three centres with Macwool to offer 760 bales on Wednesday. I think you might have gathered by now we expect a similar trend for next week.

                  Ag Concepts Fwd Prices as at 15 March 2019               

Micron

Date

Low

High

21 12-Jun-19 2250 2250 
21 9-Oct-19  2115  2115 

Main Buyers (This Week)

1

Techwool

4188

2

Tianyu Wool

3618

3

Seatech Ind.

3407

4

Aust. Merino

3307

5

Kathaytex

2329

6

Endeavour Wool

2158

Eastern Market Indicators (AUD cents/kg clean)

1979 cents ê 29 cents compared with 08/03/2019

Northern Market Indicators (AUD cents/kg clean)

2027cents ê 31 cents compared with 08/03/2019

AUD/USD Currency Exchange

0.7060 é 0.0012 compared with 08/03/2019

8 March 2019

Friday, March 08, 2019

 WEEKLY MARKET REPORT 

Week Ending 8th March, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S36/18

This Week

M36/18

Last Sale

S35/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2608

2506n

2612

-4

2802

-194

18

2520

2428

2525

-5

2395

+125

19

2381

2365

2396

-15

2085

+296

20

2340

2330

2357

-17

1958

+382

21

2321

2295n

2338n

-17

1887

+434

26

1451n

1449n

1436n

+15

1170

+281

28

1169n

1165n

1151n

+18

808

+361

30

-

945

971 (M)

-26 (M)

570 (M)

+375 (M)

MC

1237

1192n

1210

+27

1319n

-82

STEADY AS SHE GOES!

Another steady week for the wool market as the AWEX EMI had a small decline of 8 cents to 2008. In Fremantle it was a reversal of the last series as it virtually gave up all the gains of the previous sale to fall by 20 cents to 2157. The volume of dusty, tender, fine fleece types weighed on the indicators as the lots with better specs, that were few in number, were rock solid but couldn’t compete with the inferior types as they pushed the fine indicators < 18.5 down by just 5 cents while the 19s and broader retreated by 15/20 cents with some of the poorer style wools quoted 30 to 60 cents cheaper as buyers struggle to fit the vast number of these drought affected wools into orders.

Skirtings followed the lead of their fleece counterparts to see prices reduce by 10 to 20 cents across all microns and VM levels. Cardings continued their price rises after last series’ hiccup to have the 3 centres average a 30 cent increase for the MCI, now 91 cents higher (1237) than their pre-Christmas close. Crossbreds kept their stellar run going as most types added 10 to 30 cents to their previous record breaking levels.

Despite the FRX going in favour of the A$ by 1 cent to 70.50 it was not enough to stop the market from falling. Although demand remains high and supply is dwindling the quality of the offering is a hindrance to any price advancement at the moment with the selection not improving any time soon.

ABARES held its annual Outlook Conference in Canberra this week releasing its new 5 year forecast for agricultural industries. The new forecast for wool looks confusing and inconsistent which is not providing the correct information for the industry. They are forecasting that total wool production for 2018/19 will be 383mkg (2.1 million bales) a 9% fall from the previous season. This is in line with AWTA testing data that is 11% less than last season up till the end of February.

The Chinese ban on wool imports from SA continues as a delegation from there is in China to try and bring a quick resolution to the stand-off but it could take up to 2/3 months. This didn’t hinder their market (up by 2% this week) with the big Chinese processor, Tianyu, securing 1600 bales. Our national catalogue drops back to 41,700 bales next week; we offer 760 bales on Thursday hopefully to a dearer market.

            Ag Concepts Fwd Prices as at 8 March 2019               

Micron

Date

Low

High

21 12-Jun-19 2250 2250 

Main Buyers (This Week)

1

Techwool

5114

2

Fox & Lillie

4338

3

Tianyu Wool

4138

4

Seatech Ind.

3549

5

Kathaytex

2974

6

Aust. Merino

2964

Eastern Market Indicators (AUD cents/kg clean)

2008 cents ê 8 cents compared with 01/03/2019

Northern Market Indicators (AUD cents/kg clean)

2058cents ê 5 cents compared with 01/03/2019

AUD/USD Currency Exchange

0.7048 ê 0.0099 compared with 01/03/2019

1 March 2019

Friday, March 01, 2019

WEEKLY MARKET REPORT 

Week Ending 1st March, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S35/18

This Week

M35/18

Last Sale

S34/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2612

2524

2620

-8

2826

-214

18

2525

2468

2533

-8

2407

+118

19

2396

2374

2422

-26

2136

+260

20

2357

2339

2390

-33

2001

+3563

21

2338n

2333

2368

-30

1928n

+410

26

1436n

-

1414n

+22

1152n

+284

28

1151n

1133

1153n

-2

805

+346

30

-

971

983 (M)

-12 (M)

576 (M)

+395 (M)

MC

1210

1176n

1215

-5

1339n

-129

THINGS BACK TO NORMAL??

An 8 sale run of rises for the EMI came to a halt this week as the market drifted by 11 cents to 2016, the best start to the year since 2006. With Chinese mills not operating in South Africa and their decision to hold wool sales this week and our local volume lifting by 8,500 bales in the space of 4 days due to last sale’s big gains many theories were being touted as to what might happen. Could the market lose 10/15% in SA and our market following suit here with the European orders heading across the Indian Ocean to what may have been a substantially cheaper market or stay here to support our market?? When will the Chinese resume buying in SA? Growers and brokers were understandably worried about this week’s outcome on both sides of the Indian Ocean.

The market held up well as a cheaper opening trend led to a stronger finish to see 18.5s and finer up to 10 cents cheaper while broader microns gave back 25 to 35 cents. It was interesting to note Fremantle had both days of increases. Merino skirtings had a solid sale to finish in sellers’ favour. Crossbreds had a mixed week as the finer and very broad types gained 20 cents while 28/30micron lost 10 cents. Cardings gave up 10 to 15 cents for most types in this sector. The market in SA was nowhere near as bad as predicted, just a 0.6% fall and, worthy of note, the big top-maker from China (Tianyu) bought 1700 bales this week, headed to who knows where!!

Considering the events over the past few weeks global wool markets looked to have dodged a bullet. The suspension of sales in SA and the embargo from Chinese Customs on their wool imports could have led to a massive fall in their market with the potential repercussions felt here as buyers chased the potentially cheaper wool in SA. This didn’t eventuate as the good selection of finer types were in good demand from Europe.

In no real surprise to anyone the release of testing figures for February from AWTA was down 5.5% from the previous season’s weight of wool tested. This has the year-on-year decline at 11.2%; auction offerings are at 13.4% lower than last season (174,000 bales) or 4/5 selling weeks. We sell late on Wednesday next week as the national volume drops slightly to 46,000 bales. Market direction is still hard to pick but plenty of business was written on Wednesday night that didn’t really flow through to the sale room on Thursday - hopefully next week.


            Ag Concepts Fwd Prices as at 1 March 2019               

Micron

Date

Low

High

21 17-Apr-19 2280 2280 
21 29-May-19 2250 2250

Main Buyers (This Week)

1

Techwool

9007

2

Seatech Ind.

3980

3

Tianyu Wool

3814

4

Kathaytex

3061

5

Fox & Lillie

2827

6

PJ Morris Wool

2673


Eastern Market Indicators (AUD cents/kg clean)

2016 cents ê 11 cents compared with 22/02/2019


Northern Market Indicators (AUD cents/kg clean)

2063cents ê 11 cents compared with 22/02/2019


AUD/USD Currency Exchange

0.7147 ê 0.0013 compared with 22/02/2019

22 February 2019

Friday, February 22, 2019

WEEKLY MARKET REPORT 

Week Ending 22nd February, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S34/18

This Week

M34/18

Last Sale

S33/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2620

2549

2587

+33

2793n

-173

18

2533

2488

2490

+43

2389

+144

19

2422

2384

2342

+80

2153

+269

20

2390

2362

2306

+84

2017

+373

21

2368

2344

2270

+98

1927

+441

26

1414n

1419n

1368n

+46

1128

+286

28

1153n

1145

1080n

+73

798

+355

30

-

983

928 (M)

+55 (M)

591 (M)

+392 (M)

MC

1215

1168n

1183

+32

1348

-133

A DRAMATIC WEEK!

A dramatic week for wool sales globally as South Africa suspended this week’s sale because of the import suspension of their greasy wool to China due to the Foot and Mouth outbreak in January. This led to a major price lift in our market as purchasing orders in SA shifted east across the Indian Ocean to Australia resulting in the AWEX EMI jumping by 59 cents to crash through the 2000 cent barrier to 2027. In US$ terms the rise was just as significant, 50 cents to 1451 as the FRX was stronger trading 71.5 to 72 cents. All fleece types had good gains, 19 micron and broader the best performers, up by 80 to 100 cents while < 19 gained 35 to 50 cents. Skirtings sold to a dearer trend to the tune of 40 to 80 cents depending on type, micron and VM %. Cardings also continued on their merry way as the 3 centres averaged a 33 cent climb with all types in this sector up by 20/40 cents. Crossbreds were also caught up in the buying frenzy; most microns were 40 to 75 cents to the good. One of our XB clips averaged 670 cents/kg to gross $1212/bale (FLC, SKTS and LMS).

Even though the FMD outbreak occurred in the remote north in a cattle herd far from any sheep, the suspension of wool sales came out of left field with no consultation with growers. The market was tipped to be dearer here but with the SA decision panic set in and our market took off. Over-reaction?? Maybe, as SA produce about 250,000 bales of wool/year, 2% of global wool production and 6% of merino, almost entirely < 22 micron with 68% exported to China. A meeting between Cape Wools, the governing body, wool buyers and wool grower bodies have decided to hold next week’s sale but almost certainly without Chinese mills operating. SA wool buyers have warned of a sharp fall in their market next week given the reduced saleroom competition.

The extent of the drought can be seen in the latest export figures to December 2018. Australian wool exports are back by 18% when compared to the previous season with SA down by 17% and NZ, Argentina and Uruguay all falling by 5 to 7%. As a result our major importing countries are down on their volume of wool: China and Czech Republic by 20%, Italy 14% and India 5% but Germany up by a whopping 66%. Next week sees increased volume for sale here with 49,700 bales (up from 41,300 on Monday) as growers rush wool onto the market and in SA this sale’s cancelled offering and next week’s quantity has Chinese processors worried that their ability to absorb the elevated volume will be tested even though they may not buy a bale in SA.

                  Ag Concepts Fwd Prices as at 22 February 2019               

Micron

Date

Low

High

21

12-Jun-19

2260

2260

21

9-Oct-19

2100

2150

21

11-Dec-19

2100

2100

Main Buyers (This Week)

1

Techwool

5847

2

Seatech Ind.

5737

3

Fox & Lillie

3262

4

Kathaytex

2821

5

Aust. Merino

2640

6

Tianyu Wool

2357

Eastern Market Indicators (AUD cents/kg clean)

2027 cents é 59 cents compared with 15/02/2019

Northern Market Indicators (AUD cents/kg clean)

2074cents é 63 cents compared with 15/02/2019

AUD/USD Currency Exchange

0.7160 é 0.0041 compared with 15/02/2019