WEEKLY MARKET REPORT

Week Ending 6^th September, 2013

AWEX Northern Micron Indices Comparison

A NEW LEVEL

Whether it was the excitement of the successful ram sale or the good rise in the wool market, the one critical error we made in last week’s market report went almost unnoticed. Just one avid reader of our report let us know the mistake.  The EMI did rise by 52 cents, but not to 1164 as reported, but the figure should have been 1064! But as our avid reader will know by now a 64 cent jump in the EMI this sale sees the indicator at 1128, just 36 cents from last week’s incorrect figure, but odds-on the market may not reach that misquoted level next sale.

Solid Wooltrade sales pre-empted a good market with most pundits forecasting a rise of somewhere in the vicinity of 10 to 50 cents. How true they were! Only the 16.5 and 19.5 micron indicators finished outside these predictions, rising 7 and 72 cents respectively on the opening day. All other indicators added 30 to 60 cents. This bullish market didn’t scare the Chinese as more orders were booked up that night. The second day’s sale, while not as frantic, still led to solid gains across all microns as finer types led the way with 17.5s to 20 microns 30 odd cents better. By the end of the week the 19 to 20 micron range posted the biggest gains (90 to 105 cents) with all others 60 to 80 cents higher - bar 16.5s up by just 30 cents. Just 76 bales (1.1%) of fleece were passed-in in Sydney with a top price of 1555 cents for a 14.8 micron weaner line.

Skirtings followed the aggressive lead of the fleece room with momentum building to the final day’s offering as all types, regardless of VM or style, skyrocketed in price. Rises were in the order of 80 to 100 cents with the largest gains finer than 20 micron and VM levels under 5%. The clearance rate was incredible - just 7 bales from 2,274 passed-in - 99.7% sold! The carding sector had the most quiet sale with the MCI 13 cents better as locks and crutchings  looked 10 to 15 cents higher and stains up to 20 cents dearer, to see all three regional indicators for this sector now in record territory. Good gains in the Crossbred types saw rises of 15 to 30 cents, but strangely with a 3.2% pass-in rate, by far the highest of any sector.

A great week to follow on from last sale’s big rises. The 116 cent (11%) rise over the fortnight is the biggest two week gain since January 2011. This rapid rise compares favourably to the 104 cent jump in a six week period in May/June. The EMI is now just 10 cents below late January’s peak, but in US terms the market is 158 cents down due to the massive downward shift in the exchange rate from 104 to 91 cents. The gap of 101 cents between the EMI in AUD and US terms (1128 to 1027) still makes wool “very affordable” according to one major trader and we could be looking at a new level for the market. Monthly testing figures released for August by the AWTA show an alarming drop in August when compared to 12 months ago - down 15.5%. The figure not as bad when looking at July to August this year and last year, back by 5%, numbers that will get buyers’ attention with no wet weather to stall shearing over the past six weeks. Next week has 44,000 bales on offer nationally with a slight correction the most likely out-come.

Fwd. Price Trades W/E 06 September, 2013

Eastern Market Indicators (AUD cents/kg clean)                   AUD/USD Currency Exchange

1128 cents é 64 cents compared with 30/08/2013                 0.9101 é 0.0130 compared with 30/08/2013

Northern Market Indicators (AUD cents/kg clean)

1149 cents é 67 cents compared with 30/08/2013

WEEKLY MARKET REPORT

Week Ending 30^th August, 2013

AWEX Northern Micron Indices Comparison

GOOD RAM SALE AND EVEN BETTER WOOL MARKET

Smaller offerings, a lower exchange rate, Europeans back from summer vacation, good sales made last week, the improving economic conditions in the Northern Hemisphere or just the time to step in and buy some wool - any one of these reasons was trotted out by all and sundry as to why the wool market exploded into action this week to see the EMI leap by 52 cents (5.1 %) to 1164, the largest weekly rise in 30 months. The first designated super-fine sale of the season didn’t disappoint anyone as some of these specialty types added up to 100 cents to their values, but according to a successful Merino stud breeder we were talking to from Walcha at this week’s ram sale in Dubbo, the prices for sub 19 micron wool still needs to lift by a considerable amount to keep these growers in the industry - a fact that can’t be denied as the gap between 18s and 21s is still only 130 cents.

Good Wooltrade sales over the weekend and early this week hinted at a solid to dearer market (we sold a lot on Saturday night to a buyer in Melbourne!).  Both days saw substantial gains across all micron indicators - 50 to 75 cents in Sydney and a few indicators in Fremantle and Melbourne up by 80 cents. A national clearance rate of 98% was the highest in 11 years as growers were left with virtually no reason to pass-in wool, but did withdraw 900 bales from sale. The most pleasing aspect was the strong finish in Fremantle on Thursday - a rise of 40 to 55 cents with their regional indicator higher than those on the eastern seaboard.

Skirtings followed the lead of the fleece room as discounts virtually all but evaporated to see this sector add 20 to 40 cents for most types with the super-fine lots coming under intense scrutiny jumping up to 80 cents. The ever increasing volume of crossbreds (13% of the Sydney catalogue) also benefitted as fine lots to 26 micron put on 30 to 40 cents with 28s and broader quoted up to 20 cents better. Cardings continued to re-write the record books as all types and descriptions were 5 to 15 cents higher to have both MCIs on the East Coast at 860 and 845 in the West.

This week’s big rise came out of left field but was on the cards to happen in September according to most talk on the show-floor. A combination of the above factors (stated at the start of this report) led to dare we say “panic buying” as securing volume was more critical than actual price. Volume, or the lack of it, is no more evident than in the west as Fremantle goes back to a 1 day sale next week as national totals struggle to climb above 40,000 bales for the next three weeks. It will be interesting to see if any considerable volume comes out of “Sale 99” following this week’s rise.

This week saw the 53^rd National Sheep Sale and Ram Sale here in Dubbo. 53 lots were offered with 8 lots passed in. Top price was $23,000 for a Roseville Park ram with the Supreme ram of the Show from One Oak at Jerilderie making $22,000. Other stud highlights included Langdene to $16,000, Pemcaw and Willandra to $13,500, Nerstane to $12,500 and Mach shorn rams from Haddon Rig to $5,000. The 45 rams sold averaged $6100, a great average considering the seasonal conditions in QLD and Northern NSW and the state of the fine-wool market. We sell next Wednesday with a catalogue of 935 bales to hopefully a solid (if not slightly dearer) market.    

Fwd. Price Trades W/E 30 August, 2013

Eastern Market Indicators (AUD cents/kg clean)                    AUD/USD Currency Exchange

1064 cents é 52 cents compared with 23/08/2013                 0.8971 ê 0.0028 compared with 23/08/2013

Northern Market Indicators (AUD cents/kg clean)

1082 cents é 52 cents compared with 23/08/2013

WEEKLY MARKET REPORT

Week Ending 23^rd August, 2013

AWEX Northern Micron Indices Comparison

SAVED BY THE DOLLAR

Our “bold” prediction of an unchanged market wasn’t looking so good early in the week as most buyers forecasted a softer trend in the fleece room and skirtings, cardings and crossbreds to continue on their merry way up the price ladder. Had it not been for the favourable currency shift to below 90 cents from almost 92 on Wednesday night, this may have been the case.

The market had a lacklustre start to the two centre series as Fremantle sat out the week due to lack of quantity. AWEX put the EMI down by just 1 cent as 19s in Melbourne and 19 to 22s in Sydney lost up to 10 cents on the opening day. The finer indicators were in sellers’ favour up to 5 cents helped by the 800 bales of stylish super-fine New Zealand wool offered in Melbourne. The southern buyers were still keen on these types on Thursday to see ultra-fine types make good gains. The drop in the exchange rate put buyers on the front foot on Thursday as all fleece indicators in both centres posted gains of up to 10 cents. The EMI finished the sale 4 cents higher at 1012 cents - the only negatives being in the 17.5, 19, 21 and 22 micron indicators giving up 5 cents.

There was some price difference in similar types as we saw a 50 cent clean gap between two lots of 18.5 and a 20 cent premium for a 20 micron lot over another identical type and just a 5 cent gap between two weaner lots at 17 micron with NKTs of 27 and 36!  Some other lots saw no discount for colour or VM - hard to work out buyer’s thinking.

As we stated earlier, the Room 2 selection goes from strength to strength. Skirtings opened the sale on a solid note and followed the fleece movements to increase in value by 10 cents regardless of style, VM or description on the final day. After last sale’s breather, cardings rallied again this week as all descriptions added 10 to 20 cents to see both MCIs post double digit rises to new record levels. One lot of locks made 576 cents, 9 cents more than that growers Bls!  Crossbreds posted modest gains as the finer indicators were flat with 30 micron and broader rising up to 10 cents. Two areas of real gains are the Dorset and Border Leicester types with their fleece lines now making in the 250 to 320 cent area.

Optimism is buoyant amongst buyers and traders as most predict a solid to rising market as we move into the Spring selling season. Next week sees the first real volume of super-fine wool offered from Newcastle, 2800 bales. All eyes will be on the Italians as reports coming out of Europe indicate an end to the recession as the GDP figure was at last a positive number in 17 member countries of the European Union, thus ending 6 consecutive quarters (18 months) of negative growth. The US is also continuing its economic recovery giving speculation that the Federal Reserve may wind back the volume of money it prints, a staggering $85 billion/ month. This good economic news from the northern hemisphere augers well for an increase in demand and a lift in prices.

The ram selling season is almost upon us as the National Ram Sale and Show is held in Dubbo next Tuesday to Thursday. Various studs have been holding open days and will commence on-property sales from early September. Fremantle is back on line next week as the national catalogue of 41,500 bales should see an unchanged market.

                                                                                                                                                                                     Fwd. Price Trades W/E 23 August, 2013

WEEKLY MARKET REPORT

Week Ending 16^th August, 2013

AWEX Northern Micron Indices Comparison

LAST WEEK’S RISES GOOOONE!

The good start to the resumption of wool sales was just that! A one-week wonder it seems. Last week’s gain of 10 cents to the EMI was all but lost as a falling market took 9 cents off the indicator to have us back to square one. Buyers were a bit apprehensive as to where the market was headed, but most were confident it might be okay despite the softer tone from the small Wooltrade sale on Tuesday that finished 5 to 10 cents lower than last sale’s close. Some up and down movement on the Eastern Seaboard saw both centres finish unchanged on Wednesday. The market had unusual moves as Sydney’s finer types lost ground as the corresponding indicators were dearer in Melbourne with the opposite effect on the medium to broad lots – sellers’ favour here and cheaper in Melbourne. There was no confusion in the west as Fremantle’s indicators fell by up to 10 cents. This led to falls across the board on Thursday as both Eastern centres were in sync as losses of 5 to 15 cents covered most indicators. By the end of the sale Sydney’s falls were restricted to a 5 to 10 fall as Melbourne recorded similar falls except for the 20 to 23 microns giving up 20 to 30 cents.

As has been the case for many months, the Room 2 lots outperformed the fleece types. Skirtings, regardless of style, VM or micron added 10 cents to last week’s values on the opening day to finish solid on Thursday (bar the higher VM lots that were irregular). Cardings had an up and down week as the record level set last sale was relinquished on the opening day as locks and stains finished in buyers’ favour. However, increased competition on the final day had all descriptions 5 to 10 cents higher to have the MCI at 838 cents - a new record level. The only sector unchanged for the sale was the crossbreds with no movements recorded for any indicators.

Most talk on the show-floor was the good start to sales last week. In previous years the market has fallen in August and taken, in some cases, through till late September or October to show signs of a recovery. Quantity or, more to the point, lack of it should be of concern to exporters as offerings are already behind by over 4% year-to-date from last year. Most alarmingly in the west, Fremantle quantities are at a critically low volume. After the three week recess they conducted a 2 day sale, this week a 1 day sale and next week not enough wool to hold a sale! This surely must ring alarm bells in China. The effects of last year’s dry Spring to Autumn period is still being felt as lighter wool cuts and large numbers of sheep sold off to kill will still be impacting well into the future. Currency fluctuations also may be causing angst as a 4 cent move last week (88 to 92 cents) would have some exporters more cautious than normal. One thing buyers can’t complain about is the quality of the offering, with several commenting on our catalogue this week. This was reflected in some lots making 10 to 20 cents above the indicator. Some fleece lots from Nyngan and Mendooran were typed as “Best Topmakers”, even with over 3% of Bathurst Burr in some lots! A great job of presentation was done by all growers. We offer 700 bales on Thursday, with 28,000 on offer nationally (only on the East coast). Unchanged hopefully!    

Fwd. Price Trades W/E 16 August, 2013

Eastern Market Indicators (AUD cents/kg clean)                            AUD/USD Currency Exchange

1008 cents ê  9 cents compared with 09/08/2013                           0.9169 é 0.0099 compared with 09/08/2013

 Northern Market Indicators (AUD cents/kg clean)

WEEKLY MARKET REPORT

 Week Ending 9^th August, 2013

AWEX Northern Micron Indices Comparison

 OFF TO A GOOD START

Wool sales re-commenced this week following the usual three week winter recess. From most reports the buyers took a good break away from the wool business to attend their AGMs at various exotic locations both here and overseas, to going on well deserved holidays, or, as one buyer put it, ‘did absolutely nothing’. This week’s sale wasn’t the first held. Auctions Plus (who run the Wooltrade Offer board and a small electronic sale every Tuesday) held a sale last Thursday offering 6,100 bales. 15 buyers bought wool, with the top 3 securing 50% of the offering, with 30% being passed-in. Despite the large pass-in rate, the market was solid with skirtings, oddments and crossbreds rock solid and most fleece types on par or just either side of the quotes from Sale 02.

The opening AWEX sale saw a national catalogue of 45,000 bales up for sale - not an overly large offering considering the three week recess in which to collect wool for this sale. Reports of a good market stemming from last week’s results came to fruition as the EMI added 10 cents to sit at 1017 cents, 22 cents higher than 12 months ago. Fine types benefitted the most as 19 micron and finer gained 12 to 45 cents despite softening by 5 to 15 cents on Thursday due to a style adjustment. The medium indicators had minimal shifts either side of Sale 02 quotes with 23s in Melbourne slipping 20 cents to now reflect a more typical fine-to-broad price relationship.

Skirtings re-commenced selling with a bang as all types, regardless of VM and style, posted gains of 30 to 45 cents. Cardings continued to march to record levels and the 11 and 16 cent rises in Sydney and Fremantle to 836 and 830 cents respectively, set new records while Melbourne need only add 8 cents to join the other two centres in new lofty levels for cardings. All types and descriptions looked 5 to 20 cents better with LKS from Wellington, Quambone and Merriwa making 595,573 and 565 cents respectively! Crossbreds rose as well with all indicators up to 10 cents dearer.

Certainly a solid -but not spectacular - start to the run of sales through to December. One and all will be keeping a close watch on proceedings as we get into the Spring selling season and the Newcastle wools are spread more evenly through the sales. There will be no build up for every sale that was held there (as with previous seasons) as the subdued demand not coping with big volumes of the same types. Hopefully the lift in the finer indicators is a sign of things to come. The favourable move in the exchange rate to around 90 cents, and in fact below 89 at one point, would have been a help to the market. It looked as if the A$ was stuck at 92/93 cents for weeks, until better economic data from the USA last week strengthened their $. The three week gap in sales also kept mills keen to re-commence buying. One thing for sure is volumes will play a critical part in price direction. Fremantle will hold a 1 day sale next week as part of the 37,500 national catalogue - this after a three week recess! We offer 2200 bales on Wednesday, hopefully in a dearer market.             

Fwd. Price Trades W/E 12 July, 2013

Eastern Market Indicators (AUD cents/kg clean)                                     AUD/USD Currency Exchange

1017 cents é 10 cents compared with 12/07/2013                                     0.9070 ê 0.0232 compared with 12/07/2013

Northern Market Indicators (AUD cents/kg clean)

1032 cents é 12 cents compared with 12/07/2013

WEEKLY MARKET REPORT

Week Ending 12^th July, 2013

AWEX Northern Micron Indices Comparison

TOUGH BUT FAIR

With the largest offering in 13 weeks the wool market made a reasonable fist of the last sale for three weeks. The offering of just short of 50,000 bales saw 90.5% sold to the trade nationally with a slightly better rate in the North. The market opened on a good note on Wednesday probably about ten cents better for good types, but waned as the day progressed to end in negative territory by the close. On Thursday, with the recess in mind, not surprisingly the market bounced a little and gave buyers the breathing space they need to do some business during the recess. The pleasing result this week was the increased interest in fine wool types (particularly 18 microns and finer) with some select lots up to 40 cents dearer.

Our catalogue of close to 2000 bales was first up on Wednesday and included a good selection of well grown wools. About half the catalogue was from the Louth and Tilpa area and, despite a very long dry spell up till May, the wool although hungry fine maintained good tensile strength and little or no colour or veg matter. What was very evident this week were the benefits of proper clip preparation. The well prepared clips saw the small increase for all main lines whilst the cast lines did see some weaker competition. Skirtings were slightly off the pace from last week and cardings were again red hot. The locks in our catalogue ranged between 470 cents and 560 cents which equates at close to $1000 a bale! Added to this, stains were all making between 300 and 400 cents so, when the averages were done at day’s end, the overall result isn’t that far behind last year’s clip results.

Crossbreds were again well supported and closed the week close to par on the previous week. The EMI this week last year closed at 1067 so the close this week is about 5% less than last year. What is interesting from recent AWTA data was that the national wool clip in the space of 12 months has reduced micron by 0.5 which is a big year on year reduction. This will, in some part, explain the problems for the finer end of the market and also explain why 22 and 23 microns have been outselling 19.5, 20 and 21 microns for weeks. Our newsletter due out next week will have more detail on the shift in production of recent years.

The annual wool buyer’s end of season social function known as “Carding Night” was held last night in Melbourne and the only two representatives from the North (buyer or broker) were Luke and Andrew, who no doubt enjoyed the company of our buyer customers into the wee small hours. Hopefully the goodwill extends into the sale room when sales re-commence on the 5^th August.

There is positive talk for the coming season. It is expected that a decent winter in many wool growing areas will boost wool cut and micron and ease the pressure of fine wool.

Fwd. Price Trades W/E 12 July, 2013

Eastern Market Indicators (AUD cents/kg clean)                                    AUD/USD Currency Exchange

1007 cents ê  4 cents compared with 05/07/2013                                  0.9302 é 0.0191 compared with 05/07/2013

Northern Market Indicators (AUD cents/kg clean)

1020 cents ê  6 cents compared with 05/07/2013

WEEKLY MARKET REPORT

Week Ending 5^th July, 2013

AWEX Northern Micron Indices Comparison

SEASON STARTS ON A TOUGHER NOTE

There was no respite for the wool market as the opening sale of the season continued on from where last season finished-last week-.The slightly dearer market in Fremantle last Thursday didn’t filter through to this week’s Eastern Seaboard only offering of 34,000 bales. Sharp falls across all fleece indicators, resulted in the EMI giving up 36 cents to open the 2013/14 season, now hovering at just above 1000 cents (1011). A couple of factors conspired against us to send the market in a downward spiral - the biggest weekly fall in three months. Whispers of credit pressure in China and the raising of interest rates to borrow money bought a few mill’s buying patterns to a halt. Most buying houses and mills were accessing money under 6%, but now all rates have jumped to over 7 %. Even before this rise, murmurs of difficulty in accessing finance were more and more common. Also, news emerged this week of a major Chinese processer in trouble with big volumes of greasy and processed stock to be offered to the market at a discount to auction prices. With the exchange rate still jumping around, even with a real possibility that it will fall through the 90 cent barrier and these two other factors now very much in play, still makes trading a tricky business.

Most fleece indicators, 17 to 21s, conceded 35 to 55 cents with 22s finally adjusting to a level close to, but still ahead of, the 19.5 to 21 indicator giving up 66 cents to close at 1101. Despite these large falls and big discounts back in vogue for colour, tender and cot, the best style, FNF lots over 40nkts attracted solid support. A small selection of Spinners in ultra-fine micron ranges gained significant premiums over the lower style types and saw the 16.5 indicator add a modest 3 cent rise to its value.  One buyer, New England Wool, a specialist super-fine buyer, commented on the outstanding preparation of one of our clips in the catalogue from Brewarrina. He bought 41 bales of this clip’s fleece wool with specs averaging 18.68 mic, 0.8 VM, 72% yld, 87mm, 45 nkt and an average mid-break of 51%, which led him to pay 15 to 25 cents clean above the indicators for these lots. This order, for renowned Italian processor, Barberus, specifies “Spinners” style or better, the buyer couldn’t let these best-topmaking wools escape him, saying they would fit into the order perfectly. Another lot from Gilgandra at 19.5 micron and 1.7 VM was 13 cents better than the indicator, so even in a retreating market there can be some bright spots. Well done to both growers!

The good run that room 2 lots have had over the last 2 months continued to compound as all sectors lost ground on both days. Skirtings fared the worst, as the opening session saw a 30 cent fall for 5% VM and a 40 cent loss for burrier lots. Thursday saw the higher VM lots fully firm as the 3% VM types gave up another 10 cents. There was very little movement in the carding sector as the MCI lost just 1 cent to have the all time record still in sight, but not broken yet. Crossbreds didn’t escape the carnage either as 26 to 32 microns fell 5 to 10 cents.

Next week is the final sale before the annual three week winter recess. Fremantle is back on line to have a large national catalogue of 53,000 bales - the biggest since early April with a market not moving too much either way.

Fwd. Price Trades W/E 05 July, 2013

Eastern Market Indicators (AUD cents/kg clean)                                    AUD/USD Currency Exchange

1011 cents ê 36 cents compared with 28/06/2013                                 0.9111 ê 0.0210 compared with 28/06/2013

Northern Market Indicators (AUD cents/kg clean)

1026 cents ê 33 cents compared with 28/06/2013

WEEKLY MARKET REPORT

Week Ending 28^th June, 2013

AWEX Northern Micron Indices Comparison

SEASON FINISHES ON TOUGH NOTE

A tough finish to the season as the market tapered off to have the EMI finish on 1047 cents, just 29 lower than 12 months ago. Over the year wool sales were held on 113 days with the EMI averaging 1037 cents (well short of the previous season), in fact 14% down from the 10/11 season. The weaker trend of last Thursday filtered through to this sale as medium types fell on the opening day with the sub 18.5 micron lots unable to hold their ground on Thursday. By week’s end most indicators gave up 20 to 35 cents with 19s down 40. The only indicators to escape the carnage were 16.5 and 22s, only 5 cents back. In a bizarre situation the 22 micron indicator is at 1167, this now 11 cents higher than the 19 micron indicator and just 22 cents behind 18.5s! The gap in Melbourne is closer, only 21 cents between 18.5 and 23 micron - a ridiculous tightness in price. This scenario of “one price covers most wools” must certainly be of great concern to growers of 19 micron and finer. There seems to be no immediate relief in sight as Europe struggles to escape the grip of high unemployment, negative growth and low consumer confidence giving the Chinese a free run at the finer micron types without fear of competition from Europe. Maybe the recent IWTO conference in Italy left more questions unanswered than answered as to the fate of these wools.

The shining light of the market - skirtings, cardings and crossbreds - couldn’t sustain their great run and followed the fleece trend to be cheaper, bar cardings. Skirtings opened with a fall of 10 cents for 18 and finer while 19 and broader looked 30 cents back. Thursday’s fall was not as dramatic with 18 to 20 micron types under 6% VM 10 to 15 cents off while all other lots were unchanged. Crossbreds lost ground as 28 micron and finer fell 5 to 10 cents with the broader lots slipping by 20 cents. The only dearer sector of the market was cardings as a 12 cent gain to 829 cents puts these within a whisker of the record set two years ago. Locks posted a 20 cent gain, crutchings 5 to 10 higher while stains were unchanged. Most locks are now realising over 500 cents, while bulky clean crutchings below 5% VM are making close to 600 cents! These sorts of prices certainly boost the bottom line averages.

So ends another season, one with plenty of ups and downs, not only with the wool market, but all rural commodities have had their fair share big price fluctuations as well as a season of extreme weather patterns. The recovery from October to February was short lived, but the market’s rally over the past six weeks gives us hope that all is not lost on the market gaining more ground - despite Europe’s absence. The buying list provided no real surprises with Techwool on top with 10.2%(179,245) followed by the now defunct Viterra Wool, 9.4% with Fox & Lillie and Lempriere securing 15.7% between them, the top 10 buyers accounting for 64% of the clip. Total offerings were just 2% (37,600) ahead of last season at 1,943,150 bales.

Our decision to push a few clips into last weeks sale certainly paid off as the market lost it’s momentum to end the season this week. We start the new season with a modest, but stylish catalogue of 575 bales on Thursday. With Fremantle finishing Thursday around 5 cents dearer, hopes that the 35,000 bales being offered on the Eastern seaboard will be met with good competition to start the new financial year.           

Ag Concepts Fwd. Price Trades W/E 28 June, 2013

Eastern Market Indicators (AUD cents/kg clean)                                    AUD/USD Currency Exchange

1047 cents ê 19 cents compared with 21/06/2013                                 0.9321 é 0.0076 compared with 21/06/2013

Northern Market Indicators (AUD cents/kg clean)

1059 cents ê 23 cents compared with 21/06/2013

WEEKLY MARKET REPORT

Week Ending 21^st June, 2013

AWEX Northern Micron Indices Comparison

 THE BIGGEST AND THE BEST!

Our hopes that the market might be sustained were realised on the opening day of this week’s East coast only sale as Fremantle sat out this week when just 24,000 bales were on offer in Sydney and Melbourne - slightly bigger than the catalogue two weeks ago. However, the unchanged status couldn’t hang on through to the second day. The IWTO conference held in Italy last week may have woken the Italians from their summer siesta as fine types under 18.5 made reasonable gains over the two days adding 10 to 25 cents, with “HILLCRESTON/PINEHILL” offering the finest bale at auction since March 2011. Two bales were appraised as 1PPs measuring 12.1 and 12.6 selling for 18,000 and 11,500 cents. Another bale from the same grower at 13.5 microns made 4,800 cents. A pleasing result and maybe some light at the end of the tunnel, but still a long way to go for growers of 18.5 and finer. Medium wools didn’t fare as well with types up to 2%VM being unchanged on the opening day, as lots burrier than 2% back by 15 cents, the 19 to 23 micron indicators fell 10 to 20 cents on Thursday. A sudden shift in the currency looked to have played its part, but it wasn’t a rise that did the damage, with a sharp drop in the exchange rate spooking the buyers just in time for those selling on Thursday - including us! The currency has certainly been on a roller-coaster ride over the past 7 days. Last Thursday it was under 95 then quickly rose to above 96 before settling under 95 early in the week. That was ok till it took a big dip on Wednesday night to 92 cents which sent the middle microns down on Thursday as waiting to see where the exchange rate will settle is now a daily ritual.

Once again skirtings bucked the cheaper trend of some of their fleece counterparts. By sale’s end, 19 micron and finer finished in sellers’ favour with keen competition from all sectors pushing broader types 10 to 15 cents better. Cardings again added to their values as locks posted 10 to 15 cent rises with most emphasis on 18 and finer with stains and crutchings rock solid all sale. The drop in currency didn’t bother the crossbred sector as good gains on both days saw the broader end (30 microns and coarser) benefit from a 20 cent lift with the finer types in sellers’ favour.

Our delegate has arrived home safe and sound, if not a little weary and jet-lagged, from the IWTO conference in Italy. Not a great deal to report on other than Europe still in an economic hole and demand very quiet from them, but a detailed report will feature in our Winter newsletter out in July. This week marked a milestone for Macwool. With a catalogue of 1900 bales, ours was the largest catalogue to be offered in Sydney this week, totaling 8% of the offering.  We did have a few bigger catalogues in May and June last year, but the quality of the selection not as good as this week. Many buyers commented on the high standard of clips in this sale from Cunnamulla to Yass, and Binnaway to Bourke and most points in between. The catalogue had low VM best top-making fleece types (over 71% under 2%VM) and had a great selection of low VM skirtings, cardings and lambs wool as well as crossbreds. Well done to all growers who offered wool this week on the standard of preparation. Just 2% of the catalogue was passed in with an overall bale average of $1270 - a great result!

Next week has Fremantle back on line to see a national catalogue of 38,000 bales up for grabs in the final sale of the season. If the A$ can stay in the one spot for more than 24 hours we may see a firming market, otherwise there could be a few fence sitters over the next couple of sales.

Ag Concepts Fwd. Price Trades W/E 21 June, 2013

Eastern Market Indicators (AUD cents/kg clean)                                    AUD/USD Currency Exchange

1066 cents ê  4 cents compared with 14/06/2013                                  0.9245 ê 0.0217 compared with 14/06/2013

Northern Market Indicators (AUD cents/kg clean)

1082 cents ê  4 cents compared with 14/06/2013