Weekly Market Reports


30 September 2011

Friday, September 30, 2011
 

 

WEEKLY MARKET REPORT

Week Ending 30th September, 2011

Northern Micron Indices Comparison: Source of information: AWEX

AWEX
INDEX

This Week
30/09/11

Last Week
23/09/11

Change

Last Year
30/09/10

Yearly
Change

18

1566

1671

-105

1237

+329

19

1437

1504

-67

1051

+386

20

1320

1353

-33

910

+410

21

1281

1309

-28

887

+394

22

1209

1241

-32

861

+348

23

1060n

1108

-48

-

-

24

996n (M)

1000 (M)

-4

-

-

28

676

686

-10

444

+232

30

623

622n

+1

389

+234

32

585n

584

+1

354

+231

MC

735

732n

+3

571

+164

STOCK MARKETS RECOVER – WOOL MARKET KEEPS FALLING

The wool market lurches from bad to worse as the EMI slips under 1200 cents for the first time since January of this year. A 42 cent fall now has the EMI on 1193 cents. All three centres recorded double digit falls on both selling days. Any sentiment of positive note has all but gone from the market as buyers struggle to sell any quantity of any type, especially in the fine sector.  Only the Crossbreds and Cardings escaped with prices in tact this week. Heavy uncertainty over Europe’s ability to ride out the current financial crises and avoid an almost certain slip back into recession is weighing heavily on confidence and direction of stock markets as the yoyo effect is a daily ritual with any sort of good or bad news driving the markets up or down. No sector of the fleece market escaped the negative tone as 18 and finer fell 105 to 140 cents - this despite a mini recovery on Thursday of 17 and finer. This recovery was partly a result of a clip of ours under 18 microns all selling above their indicator level. New England Wool bought all but 3 bales of fleece (32 bales) ranging in price from 1230 to 1520 cents and also secured the BKN, all for processing in Biella, Italy. Well done to this grower on a clip equal to anything to come out of a super-fine area. All other indicators fell from 30 to 50 cents for 19.5 to 23s and 65 to 80 cents for 18.5 to 19, again discounts for heavy colour and cott were the order of the day with some lots attracting ‘NO BID”.

Once again, skirtings were hit hard with most types feeling the effects of buyer neglect. Fine lots lost 70 to 80 cents, while 20 micron and broader fell by 40 cents, with the burrier end of the types (8 VM +) least affected. Cardings, as mentioned, remained fairly static with fine locks 20 down on the first day and stains 10 dearer on the final day with some burry bellies and carbonising pieces looking cheaper. Crossbreds moved very little as 28s lost 10 cents with all other types remaining unchanged from the previous week under a smaller offering than the past four weeks.

A tough few weeks for the market as mills and traders are not likely to commit themselves to buying wool unless they have solid commitments at the other end. Most business has ground to a halt with little prospect of orders being booked up over the next few weeks. Medium wools might be close to the bottom, but unfortunately fine types may suffer more losses as one buyer said they “cannot sell a kilo” of 18 or finer into China with only the better style clips, as was the case this week, being sought after by Italy. A quick look at the table above does tell us the market is in far better shape than 12 months ago but, going forward, the light at the end of the tunnel is small but hopeful of a turn-around in the markets fortunes sooner rather than later. Next week sees a national catalogue of 48,000 bales with little hope of a dearer market, but at least it’s rained across a wide area! And – dare we say it – Go Manly and Geelong! in this weekend’s Grand Finals (the opinion of the author of this report do not necessarily reflect those of his colleagues!)

Agrisk FDIC Indicative Quotes 30/09/2011

20

21

22

AUCTION

1316.5

1279.0

1195.0

Oct-11

1299

1260

1194

Dec-11

1278

1239

1173

Feb-12

1241

1202

1136

Apr-12

1196

1157

1091

Jun-12

1167

1128

1062

Aug-12

1156

1117

1051

Oct-12

1124

1085

1019

Dec-12

1091

1052

986

MAJOR AUCTION BUYERS (Bales)

1

Viterra Wool

4885

2

QLD Cotton

4369

3

Fox & Lillie

3757

4

Techwool Trading

2888

5

Williams Wool

2343

6

Lempriere (Aust)

1931

7

Kathaytex

1440

8

G Schneider (Aust)

1408

9

Michell Australia

1322

                       

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

                Eastern 1193 cents (ê42) compared with 23/09/11                                0.9795 ê 0.0220 compared with 23/09/11

                Northern Market Indicators (AUD cents/kg clean)

                Northern 1238 cents (ê48) compared with 23/09/11

23 September 2011

Friday, September 23, 2011

WEEKLY MARKET REPORT

Week Ending 23rd September, 2011

Northern Micron Indices Comparison: Source of information: AWEX

AWEX
INDEX

This Week
23/09/11

Last Week
16/09/11

Change

Last Year
23/09/10

Yearly
Change

18

1671

1785

-114

1222

+449

19

1504

1553

-49

1048

+456

20

1353

1385n

-32

906

+447

21

1309

1337n

-28

886

+423

22

1215 (M)

1273 (M)

-58

852

+363

23

1082 (M)

1163 (M)

-81

829

+253

24

1000 (M)

1029 (M)

-29

780

+220

26

865n

-

-

603

+262

28

686

688n

-2

443

+243

30

622n

633n

-11

393

+229

32

586 (M)

587 (M)

-1

354

+232

MC

732n

751

-19

564

+168

EVERYTHING FALLING – OH DEAR!

Another bad week for the wool market as global concerns over the Northern Hemisphere economic downturn send stock markets into meltdown and all and sundry awaiting news of several European countries preparing to default on their $billion loans. Only a bail-out from France and Germany will save the countries in strife with these two economies already stretched to their borrowing limits. Even the currency fall to 97 US cents overnight may not be enough to correct the slide in the wool market. All segments of the processing chain are reporting cautious buying patterns with a lot of traders now adopting a ‘wait and see’ approach. The uncertainty could dampen demand to the point of potentially big falls in the market. As this week’s falls indicate, buyers are in no hurry to book wool up or buy “stock” with most reporting “no direction” as to what to do in regards to buying wool at a certain price level or their ability to on-sell their purchases at profitable margins. As a result the market got progressively cheaper as the week went on with some of the finer indicators in free fall. After the market was flooded with too much of the same type in Newcastle, buyers virtually had no orders for 19 micron and finer. This ridiculous situation of Newcastle holding just three sales between September and November and one in February just to appease some New England wool growers and Brokers has to be looked at. Surely a more even spread of types through more orderly marketing over a few weeks is the way to go, not expect buyers to absorb too much or the 1 type for 1 sale in every 4 weeks! Last time we checked the buyer was still our customer! The finer end of the market (18 and lower) took the biggest hit as falls of 115 to 145 cents were recorded. 18.5 to 19.5 and 23s lost 50 to 75 cents with the remaining fleece indicators averaging 30 cent falls. Discounts for VM, colour and cott grew, with some doubling from two week ago. The EMI, now at 1235 cents has lost 59 cents in the last three sales since its mini-recovery a month ago. We are at the lowest point for eight months.

Skirtings held their levels early in the week only to weaken late in the sale. Initially, fine pieces and bellies lost 10 to 20 cents with the broader types giving up the same amount on Thursday. Lots with heavy cott, colour and jowl were discounted - double the rate of a few weeks ago. Cardings gave up last week’s positive moves as all types fell by 20 to 30 cents, which saw a 19 cent fall in the MCI after last sale’s 20 cent rise. Crossbreds weren’t immune to the sour market as losses of up to 15 cents were recorded.

Well done to the Duncan family from Louth and Steven Carter from Nyngan who were the first clients to deliver wool to the new wool-store. As this report is written the core machine is on its way over there and should be operational by next Thursday. The address of the new wool-store is 2L Richardson Rd, West Dubbo (in behind Metalcorp and Sam’s Hire). A smaller offering of 43,000 bales will probably not be enough to stop the falling trend next week.           

AgRisk FDIC Indicative Quotes 23/09/11

20

21

22

AUCTION

1351.0

1308.5

1228.0

Oct-11

1310

1271

1205

Dec-11

1280

1241

1175

Feb-12

1243

1204

1138

Apr-12

1198

1159

1093

Jun-12

1169

1130

1064

Aug-12

1158

1119

1053

Oct-12

1126

1087

1021

Dec-12

1093

1054

988

MAJOR AUCTION BUYERS (Bales)

1

Viterra Wool

5182

2

Williams Wool

3924

3

Fox & Lillie

3374

4

Lempriere (Aust)

2890

5

Techwool Trading

2704

6

Sky Wool

2315

7

Kathaytex

2298

8

QLD Cotton

2271

9

Michell Australia

1898

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

                Eastern 1235 cents (ê39) compared with 16/09/11                                1.0015 ê 0.0196 compared with 16/09/11

                Northern Market Indicators (AUD cents/kg clean)

                Northern 1286 cents (ê39) compared with 16/09/11

16 September 2011

Friday, September 16, 2011

WEEKLY MARKET REPORT

Week Ending 16th September, 2011

Northern Micron Indices Comparison: Source of information: AWEX

AWEX
INDEX

This Week
16/09/11

Last Week
09/09/11

Change

Last Year
16/09/10

Yearly
Change

18

1785

1848

-63

1224

+561

19

1553

1594

-41

1054

+499

20

1385n

1429

-44

909

+476

21

1337n

1372

-35

886

+451

22

1273 (M)

1277 (M)

-4

857

+416

23

1163 (M)

1175n (M)

-12

837

+326

24

1029 (M)

1052 (M)

-23

793

+236

26

877 (M)

857 (M)

+20

606

+271

28

688n

688

0

448

+240

30

633n

634

-1

399

+234

32

587 (M)

582n (M)

+5

354

+233

MC

751

731

+20

564

+187

A DISAPPOINTING DROP

What goes up must come down! An unfortunate saying, but one that has rung true for this week’s wool market. After a good rise and the forecast of better things to come the previous week, the market gave up most of last week’s gains despite the superior offering listed for the first Newcastle sale of the season. The Newcastle catalogue was one of the best in years with 76% of the adult fleece selection 40nkt or better and 24% appraised as “spinners” style. A sharp fall in futures late on Monday afternoon set the tone for the week as the market fell progressively over the three days. The excellent types and the falling exchange rate (4 cent fall) could not prevent the sliding trend, with only the spinners and better style lots attracting Italian interests to post 100 cent increases. Apart from these types all other indicators lost 25 to 70 cents. The national offering of over 52,000 bales scheduled for next week seems to have scared some buyers into thinking that there is plenty of wool around, thus no need to rush in and “panic buy”. Just three lots made over 3,000 cents with a top price of 3,270 for a 14.6 micron lot.

The attractive offering of skirtings also commanded good buyer interest as the stylish, low VM lots made significant gains with all other types closing the week where they started. Cardings continued to claw back the August losses to see the MCI add 20 cents to its value to be at 751 cents by the close of trade. The rises were from 15 to 30 cents across the board regardless of style or VM. One carding buyer we spoke to commented on a few lots of crutchings that made over 850 cents greasy, yielding over 70% and FNF going into “open-top” fleece orders and locks being purchased for the same order making over 600 cents; incredible money! The very small but select crossbred catalogue (6.7% of the Newcastle sale, compared with the previous 5 week average of 14.6%) added up to 20 cents to their previous week’s quotes.

A significant week for us here at Don Macdonald & Co as we warmly welcome Ian Sharp on board. Ian will be our Sydney based Technical Manager and Auctioneer as well as area rep looking after clients from Cooma to Bourke. He brings with him 37 years of invaluable experience. His enthusiasm and keenness will rub off on all of us as he comes off his enforced 3 month hiatus. We wish him all the best. This week also marks the start of operations in our new wool-store. We have now relocated 1000 bales to the new site and receivals as from next Thursday will be directed there. The address is Richardson Rd, West Dubbo. Turn off the highway at Metalcorp and it’s the big shed on the left after Sam’s Loos!               

AgRisk FDIC Indicative Quotes 09/09/11

20

21

22

AUCTION

1420.5

1367.5

1286.5

Oct-11

1394

1355

1289

Dec-11

1364

1325

1259

Feb-12

1303

1264

1198

Apr-12

1258

1219

1153

Jun-12

1229

1190

1124

Aug-12

1219

1180

1114

Oct-12

1187

1148

1082

Dec-12

1154

1115

1049

MAJOR AUCTION BUYERS (Bales)

1

Viterra Wool

4893

2

QLD Cotton

3966

3

Williams Wool

3785

4

New England Wool

3365

5

Fox & Lillie

3120

6

Techwool Trading

2290

7

G Schneider (Aust)

2257

8

Modiano (Aust)

2022

9

AS Gedge (Aust)

1265

                       

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

 Eastern 1274 cents (ê20) compared with 09/09/11                              1.0211 ê 0.0387 compared with 09/09/11

 Northern Market Indicators (AUD cents/kg clean)

 Northern 1325 cents (ê19) compared with 09/09/11

9 September 2011

Friday, September 09, 2011

WEEKLY MARKET REPORT

Week Ending 9th September, 2011

Northern Micron Indices Comparison: Source of information: AWEX

AWEX
INDEX

This Week
09/09/11

Last Week
02/09/11

Change

Last Year
08/09/10

Yearly
Change

18

1848

1827

+21

1232

+616

19

1594

1567

+27

1062

+532

20

1429

1382

+47

917

+512

21

1372

1338

+34

893

+479

22

1296

1276n

+20

870

+426

23

1180n

1175n

+5

852

+328

24

1052 (M)

1015 (M)

+37

808

+244

26

857 (M)

831 (M)

+26

606

+251

28

688

688

0

452

+236

30

634

632

+2

398

+236

32

580n

581n

-1

353

+227

MC

731

705

+26

562

+169

MARKET RECOVERS SOME LOST GROUND

Our prediction of a dearer market rang true as the past two weeks of consolidation led to a solid basis for a reasonable volume of wool to be traded. Most exporters booked up wool late last week and early this week and this, coupled with the falling exchange rate, augured well for a rise in the market. The market was off to a flying start on Wednesday as most indicators recorded 10 to 35 cent gains. The finer indicators (finer than 17.5) failed to fire to finish in buyers’ favour. The rises weren’t as pronounced on the final day of trading with gains of up to 10 cents. Most notable was the shrinking discounts for VM and colour and cott. Some of our fleece lots with colour and soft cott made up to 20 cents clean more than same micron lots with the only fault being VM. One buyer we spoke to thought the discounts for VM in the 2 to 5 % range had halved with big volumes of these types being booked up over the past few days. This week’s rising market saw us sell every lot, our first 100% clearance. 57% of our fleece lots made over 1000 cents with the average greasy price for fleece wool in Sydney this week at 1079 c/kg. This compares favourably with Melbourne - their fleece price was 896 cents - despite the Sydney offering just 0.9 micron finer than Melbourne’s selection. The highlight was the 25 micron indicator in Melbourne climbing a massive 82 cents.

The good gains weren’t confined to the fleece room as skirtings pushed higher on both days. By the close of trade all types and VM levels looked to be 30 to 40 cents up on last week. We had three lots that made over 1000 cents with two lots of Nyngan BKN averaging 610 cents with LKS from Yeoval making 513 cents - a great result! Cardings also pushed higher as the MCI lifted by 26 cents. Locks and Crutchings added 20 to 30 cents while Stains performed the best in this sector with 35 to 40 cent rises. Crossbreds took a breather this week and remained virtually unchanged bar the finer end with 25s mentioned earlier and 26 microns posting a 25 cent rise.

The cycle of upward prices looks to have started again as the EMI added 24 cents to sit at 1294 cents. This rise follows on from the poor start to the resumption of sales after the July recess. The opening two weeks saw the EMI fall 98 cents with the next three sales (including this week) claw back 31 cents. Next week’s action moves to Newcastle as they host their first sale of this season. 15,000 bales are rostered with a sprinkling of superfine clips on offer to test demand for this sector of the market. Growers should notice a big difference in prices as some of these types have nearly doubled in value in 12 months. Our new wool store is nearing completion as the shed is practically finished and the office is being built at a rapid rate. Photos are on the website to check progress of construction.     

AgRisk FDIC Indicative Quotes 09/09/11

20

21

22

AUCTION

1420.5

1367.5

1286.5

Oct-11

1394

1355

1289

Dec-11

1364

1325

1259

Feb-12

1303

1264

1198

Apr-12

1258

1219

1153

Jun-12

1229

1190

1124

Aug-12

1219

1180

1114

Oct-12

1187

1148

1082

Dec-12

1154

1115

1049

MAJOR AUCTION BUYERS (Bales)

1

Viterra Wool

5278

2

Fox & Lillie

3130

3

Lempriere (Aust)

2710

4

QLD Cotton

2667

5

Techwool Trading

2517

6

Chargeurs Wool

1923

7

Williams Wool

1767

8

PJ Morris

1546

9

AS Gedge (Aust)

1506

                       

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

Eastern 1294 cents (é24) compared with 02/09/11                                                1.0598 ê 0.0099 compared with 02/09/11

Northern Market Indicators (AUD cents/kg clean)

Northern 1344 cents (é25) compared with 02/09/11

2 September 2011

Friday, September 02, 2011

WEEKLY MARKET REPORT

Week Ending 2nd September, 2011

Northern Micron Indices Comparison: Source of information: AWEX

AWEX
INDEX

This Week
02/09/11

Last Week
25/08/11

Change

Last Year
02/09/10

Yearly
Change

18

1827

1824

+3

1237

+590

19

1567

1572

-5

1059

+508

20

1382

1377

+5

917

+465

21

1338

1328

+10

896

+442

22

1276n

1287n

-11

NA

-

23

1175n

1174n

+1

NA

-

24

1015 (M)

1000 (M)

+15

NA

-

26

831 (M)

838 (M)

-7

NA

-

28

688

691

-3

459

+229

30

632

631

+1

403

+229

32

581n

581

0

358

+223

MC

705

702

+3

603

+102

DEARER AND GAINING MOMENTUM

Last week’s market gave us some good signals that, for the time being, the market had bottomed out. Coming off last week’s stable market we did actually see a little improvement this week as the EMI lifted by 6 cents to sit at 1270c/kg. Most indicators moved ahead by single figures with 21s up by 10 cents. A few indicators did lose some ground, with 18.5 and 19s back 5 and 22 microns down 11 cents. The market started on a positive note with prices edging higher - more so in Melbourne on the back of a superior offering out of Launceston and western Victoria with some “spinners” types quoted 90 cents up on the previous week’s sale in Melbourne. In fact, price difference between some 40 and 43 Nkt strength lots finer than 18.5 micron was out to 150 cents! This trend continued on the second day when we sold. Again the market improved with some of our lots under 18 micron making 40 cents better than the indicators. One buyer, New England Wool, a noted super-fine buyer of FNF types, has had to loosen his specifications to fill orders buying fleece types up to 2% VM as very few lots now contain under 1% of burr with this situation not really expected to improve as we move into Spring shearing. Normally, catalogues would be full of FNF fleece lots, but since the wet summer and big season earlier in the year, a higher % of wool is carrying more VM leaving less freer types in the catalogues. This week’s highlight was the sale of 3 bales from the Picker family at Bigga. The bales, assessed as 1PPs, averaged 13.7 micron and made from 3,560c/kg to 3,200 cents. Reasonable money we might think when compared to a 20 micron lot that is making around 900 cents, but this sector of the market has actually collapsed. Three years ago a 13.9 micron lot of theirs made 23,000 cents and a bale of 13.6 bought 30,000 cents!   

Merino skirtings were also well supported as all VM ranges benefited from keener competition across the board. By week’s end most types had recorded gains of up to 10 to 20 cents. Cardings made subtle gains with the best performer being stains, posting a 10 cent rise. Movement in the Crossbred sector was limited as medium types finished in buyers’ favour with the broader lots (30 to 32 microns) unchanged. Some finer types did increase in value as 24s and 25s  looked 10 to 15 cents better than last week.

Just a reminder that three Flystrike and Lice Management days will be held in the third week of September in the Western Division. Louth on 20th, Cobar 21st and Nyngan 22nd. Book your spot by calling Trangie Ag Research Station on 6880 8000 (Trudie Atkinson). 38,000 bales are catalogued next week with a solid to dearer market forecast.

 

AgRisk FDIC Indicative Quotes 02/09/11

20

21

22

AUCTION

1379.0

1337.0

1267.5

Oct-11

1357

1318

1252

Dec-11

1325

1286

1220

Feb-12

1289

1250

1184

Apr-12

1244

1205

1139

Jun-12

1215

1176

1110

Aug-12

1205

1166

1100

Oct-12

1173

1134

1068

Dec-12

1131

1092

1026

MAJOR AUCTION BUYERS (Bales)

1

Viterra Wool

7511

2

QLD Cotton

3075

3

Fox & Lillie

2576

4

Techwool Trading

2428

5

Williams Wool

2065

6

PJ Morris

1751

7

Modiano (Aust)

1675

8

Lempriere (Aust)

1656

9

AS Gedge (Aust)

1461

                       

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

Eastern 1270 cents (é6) compared with 24/08/11                                  1.0697 é 0.0208 compared with 24/08/11

Northern Market Indicators (AUD cents/kg clean)

 Northern 1319 cents (é4) compared with 24/08/11

19 August 2011

Friday, August 19, 2011

WEEKLY MARKET REPORT

Week Ending 19th August, 2011

Northern Micron Indices Comparison: Source of information: AWEX

AWEX
INDEX

This Week
19/08/11

Last Sale
12/08/11

Change

Last Year
19/08/10

Yearly
Change

18

1798

1887

-89

1168

+630

19

1588

1590

-2

1048

+540

20

1382

1426

-44

928

+454

21

1339

1350

-11

906

+433

22

1286

1319

-33

897

+389

23

1182n

1220n

-38

883

+299

24

1020n

1053n

-33

829

+191

26

814n (M)

849n (M)

-35

601

+213

28

690

698

-8

457

+233

30

628

635

-7

405

+223

32

573n

577n

-4

361

+212

MC

702

734

-32

604

+98

BAD START CONTINUES

Hopes of a stable market were gone as early as Tuesday as all the talk was cheaper. Despite shrinking quantities over the next three weeks to a national weekly average of 42,000 bales and a relatively steady exchange rate, the market took another hit (albeit not as big as the previous week). The opening day saw losses of 30 to 40 cents for 18 micron and finer and the 20 micron indicator. All other indicators lost 10 to 20 cents bar 19s which posted a modest 2 cent gain. Thursday saw losses mainly in the finer types and broader end. 18.5 and finer again suffered from a lack of demand, shedding 40 to 60 cents. 19 to 21 micron were in buyers’ favour with 22 and 23s averaging a 15 cent fall. The 39 cent fall that the AWEX EMI suffered this week followed on from last week’s 59 cent drop to see the indicator on 1263 cents - its lowest point for 6 months. The 2 week fall of 98 cents is the biggest fortnightly fall in almost three years. Buyers are reporting difficult trading conditions for types under 18.5 micron, with virtually nothing sold regardless of vm. The falls of 60 to 90 cents in these categories this week is an indication of this lackluster sector of the market. The middle micron lots may be closing in a level of stability as falls of up to 15 cents (20s lost 44 cents) were met with some relief! 22s and broader lost 35 to 40 cents - a sign that these reached unsustainable levels before the July recess.

Skirtings suffered the same fate as the fleece room with opening day losses 20 to 30 cents with emphasis on the finer end of the offering. Buyer support was keener early on the final day but did wane towards the end of the day to leave all descriptions in buyers’ favour. Cardings continued their fall from grace as locks fell 40 to 50 cents with crutchings and stains giving up 30 to 40 cents. Cardings in the West seem to be doing a lot better as their MCI is 772 with the Northern MCI now down to 702 cents (a drop of nearly 100 cents since sale 01). Crossbreds couldn’t add to last week’s gains and slipped 5 to 10 in the 28 to 30 micron range with 26s losing 35 cents.

Uncertainty is still gripping not only the wool market, but global financial markets. The threat of a Northern Hemisphere recession is more likely than not. The big overnight losses in the US to see the Dow Jones slip to under 11,000 is a blow to any confidence that may have existed. This, coupled with ongoing debt troubles in Europe, have economists and, more importantly, consumers around the world nervous about their spending habits. If people stop spending demand will certainly fall away and, with it, wool prices. Mills are cautious about their buying patterns and nothing will change in the immediate future given the economic conditions faced by many countries north of the Equator. Lack of supply is in our favour with no real movement either way soon. Next week’s national offering is under 40,000 with Don Macdonald& Co first up on Tuesday.    

AgRisk FDIC Indicative Quotes 19/08/11

20

21

22

AUCTION

1377.0

1335.5

1277.0

Oct-11

1339

1300

1234

Dec-11

1299

1260

1194

Feb-12

1263

1224

1158

Apr-12

1218

1179

1113

Jun-12

1171

1132

1066

Aug-12

1161

1122

1056

Oct-12

1128

1089

1023

Dec-12

1086

1047

981

MAJOR AUCTION BUYERS (Bales)

1

Viterra Wool

7437

2

Fox & Lillie

3768

3

Techwool Trading

2822

4

QLD Cotton

2367

5

Lempriere (Aust)

1843

6

Modiano

1836

7

Williams Wool

1786

8

AS Gedge

1610

9

G Schneider (Aust)

1558

                       

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

 Eastern 1263 cents (ê39) compared with 11/08/11                                               1.0491 é 0.0217 compared with 11/08/11

 Northern Market Indicators (AUD cents/kg clean)

 Northern 1312 cents (ê37) compared with 11/08/11

12 August 2011

Friday, August 12, 2011

WEEKLY MARKET REPORT

Week Ending 12th August, 2011

Northern Micron Indices Comparison: Source of information: AWEX

AWEX
INDEX

This Week
12/08/11

Last Sale
13/07/11

Change

Last Year
12/08/10

Yearly
Change

17

2267n

2384n

-117

1242

+1025

18

1887

1964

-77

1146

+741

19

1590

1668

-78

1040

+550

20

1426

1493

-67

926

+500

21

1350

1439

-89

909

+441

22

1319

1390n

-71

906

+413

23

1220n

1266n

-46

891

+329

26

849n (M)

851 (M)

-2

604

+245

28

698

694

+4

454

+244

30

635

616

+19

400

+235

32

577n

565n

+12

356

+221

MC

734

801

-67

598

+136

OFF TO A BAD START

Wool sales resumed this week after the annual three week winter recess with a reduction in prices across the board. With economic uncertainty gripping the Northern Hemisphere, an 11 % move in the exchange rate within a week and the second largest offering since January, the market was always going to be put under pressure. From the opening lot on Tuesday losses were widespread with all indicators shedding 50 to 65 cents, except 22s and 23s, dropping 35 to 45 cents. Types with heavier burr, colour and cott recorded losses of up to 100 cents, but by the close of trade increases were being found in some microns. This slightly better tone continued on through to Wednesday when we sold with most indicators posting a 5 to 10 cent gain. Luck was on our side as, by Thursday, the tone had slipped and the market retreated by another 10 to 40 cents across the board. By week’s end 17 and finer fell by 120 cents and more with 17.5 to 22 micron giving up 65 to 90 cents and 23 and 24s dropping 45 cents.

Skirtings followed a similar pattern to the fleece room as medium types lost 30 cents with the finer pieces and bellies giving up 60 to 80 cents. The firm to dearer tone that we experienced on the Wednesday couldn’t be sustained on Thursday as an increase in 6% vm and higher early in the day was negated as all descriptions closed 10 to 20 cents lower. As was the case with the other sectors of the merino market, cardings also took a hit. The 50 to 80 cent fall on the opening day for all types was negated slightly on Wednesday as gains of 10 cents were recorded. Any momentum from the previous day was well and truly gone by Thursday as falls of 10 to 20 cents were the order of the day. The currency sensitive crossbred sector bucked the falling trend to post 5 to 20 cent gains. After 15 to 20 cent falls on Tuesday the market recovered to give this week’s market some good news.

A disappointing start to this series of sales as the 59 cent fall in the EMI was the largest weekly fall in 10 months.19% of the offering was passed in, the highest pass in rate since April 2010. Deepening concerns over economic stability in Europe and the USA teetering on the brink of bankruptcy coupled with their downgrading to AA+ of their credit rating, has made for an uncertain and nervous few weeks for global stock markets as the reality of another recession looms large. The inability of some countries to repay mountainous amounts of debt to the World Bank has the ability to rattle consumer confidence in our most important wool consuming markets. If the drop in demand comes, this has the potential to hurt the wool market and force prices down. The supply situation will not change dramatically as reports of poor lambings are common-place, thus keeping pressure on the ability to increase numbers any time soon. National offerings drop to 47,800 next week with Don Macdonald cataloguing 1500 bales late on Thursday. Fingers crossed that the market can stay somewhere at these levels.

AgRisk FDIC Indicative Quotes 12/08/11scriptions

20

21

22

AUCTION

1427.5

1360.5

1319.5

Aug-11

1403

1364

1298

Oct-11

1364

1325

1259

Dec-11

1325

1286

1220

Feb-12

1305

1266

1200

Apr-12

1260

1221

1155

Jun-12

1213

1174

1108

Aug-12

1203

1164

1098

Oct-12

1170

1131

1065

MAJOR AUCTION BUYERS (Bales)

1

Viterra Wool

6796

2

Fox & Lillie

4613

3

Modiano

4080

4

Techwool Trading

3463

5

Lempriere (Aust)

2777

6

Chinatex (Aust)

2371

7

Chargeurs Wool

1952

8

PJ Morris Wool

1529

9

AS Gedge

1309

                       

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

                Eastern 1302 cents (ê59) compared with 13/07/11                                                1.0274 ê 0.0357 compared with 13/07/11

                Northern Market Indicators (AUD cents/kg clean)

                Northern 1349 cents (ê61) compared with 13/07/11

15 July 2011

Friday, July 15, 2011

WEEKLY MARKET REPORT

Week Ending 15th July 2011

Northern Micron Indices Comparison: Source of information: AWEX

AWEX
INDEX

This Week
13/07/11

Last Week
08/07/11

Change

Last Year
14/07/10

Yearly
Change

17

2384n

2400n

-16

1239

+1145

18

1964

1996

-32

1155

+809

19

1668

1666

+2

1045

+623

20

1493

1484

+9

930

+563

21

1439

1423

+16

922

+517

22

1390n

1386n

+4

906

+484

23

1266n

1282n

-16

892

+374

26

851 (M)

875n (M)

-24

615

+236

28

694

680

+14

462

+232

30

616

618

-2

405

+211

32

565n

560n

+5

359

+206

MC

801

797

+4

629

+172

WE’RE NOT DONE YET!

A reasonable finish to wool sales as fears of another tough week had abated by the end of selling on the second day. Talk of a 30 to 40 cent fall rang true from the opening lot on Tuesday, but buyers seemed to warm to the task as a recovery of some sort had been staged when we sold midway through the day. Even though the market was cheaper, the outcome was far better than what was predicted earlier in the day. 20 to 22s only lost 5 to 10 cents, except for 21s which posted a 3 cent gain. Finer types varied with some better 17 to 17.5s pushed higher by Italian orders. However, the lower style and tender lots dragged 16.5s back 60 cents; 17, 18.5 and 19s  slipped an average of 15 cents and the 18 and 23 micron indicators losing 25 to 35 cents. The recovery kept going on Wednesday as 18 and finer were unchanged with all other indicators 5 to 15 cents higher. Even with the EMI recording only a 2 cent rise it was a great way to go into the three week winter recess. As the table above illustrates, all medium micron lots staged a recovery with 17, 18.5 and 23s down 10 to 15 with 18 and 16.5 microns hardest hit. We still had buyers booking up passed in lots on Friday morning - a good sign of genuine enquiry with talk of plenty of wool booked up for August and September shipment. This augers well for a good start to sales which will recommence on Wednesday 10th August providing no economic bad news comes out of the Northern Hemisphere in the next three weeks that may dampen demand.

Skirtings held their ground on the opening day bar the lots carrying heavy cott and colour again not well sought after. The final day’s offering came under renewed buyer pressure with light vm types under 5% 10 to 20 dearer with the straight burrier types closing 10 cents dearer. Cardings had an up and down week as fine locks less than 19.5 micron lost 20 cents only to claw back 10 cents on the final day of sales. Stains and crutchings also added 10 cents to last week’s quotes, this despite buyers having to contend with the largest weekly offering of cardings in Sydney for 9 years (3100 bales-15% of the week’s offering). Crossbreds also had a good week with 28 and 32 micron indicators up by 5 to 15 cents while 26 and 30 microns fell up to 5 cents.

A well earned rest now for buyers and brokers alike as we move into the annual three week winter recess. For us here at Don Macdonald & Co it has been an extremely hectic period since our first sale in early May. In the eleven weeks till this week’s sale we’ve offered over 11,500 bales to the trade with a clearance of 92%. The next six months and indeed beyond hold much hope for a sustained wool market at these levels or, dare we say, even higher?  Supply is still extremely low and demand is good - a situation that won’t change in the for-seeable future. Let’s hope badly needed rain comes before our next report on 12th August.                                                            AgRisk FDIC Indicative Quotes 15/07/11

20

21

22

AUCTION

1495.5

1444.0

1396.5

Aug-11

1480

1441

1375

Oct-11

1390

1351

1285

Dec-11

1350

1311

1245

Feb-12

1330

1291

1225

Apr-12

1285

1246

1180

Jun-12

1238

1199

1133

Aug-12

1228

1189

1123

Oct-12

1195

1156

1090

MAJOR AUCTION BUYERS (Bales)

1

Viterra Wool

10576

2

QLD Cotton

3992

3

Modiano

3551

4

Williams Wool

3314

5

Fox & Lillie

3277

6

Techwool Trading

2384

7

AS Gedge

2191

8

Lempriere (Aust)

1757

9

PJ Morris Wool

1474

                       

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

                Eastern 1361 cents (é2) compared with 07/07/11                         1.0631 ê 0.0111 compared with 07/07/11

                Northern Market Indicators (AUD cents/kg clean)

                Northern 1410 cents (é1) compared with 07/07/11

 

8 July 2011

Friday, July 08, 2011

WEEKLY MARKET REPORT

Week Ending 8th July 2011

Northern Micron Indices Comparison: Source of information: AWEX

AWEX
INDEX

This Week
08/07/11

Last Week
01/07/11

Change

Last Year
08/07/10

Yearly
Change

17

2400n

2392n

+8

1267

+1133

18

1996

2062n

-66

1175

+821

19

1666

1709

-43

1061

+605

20

1484

1505

-21

937

+547

21

1423

1438

-15

931

+492

22

1386n

1415n

-29

921

+465

23

1282n

1298n

-16

902

+380

26

875n (M)

900n (M)

-25

617

+258

28

680

711n

-31

469

+211

30

618

648n

-30

415

+203

32

560n

590n

-30

366

+194

MC

797

823

-26

619

+178

SEASON OPENS ON A SOFTER NOTE

The new season started as the last season ended - trending downward. Reasons for the fall varied from too much wool in the opening two weeks of the season to worries about the economic problems in Europe and North America and Chinese mills unwilling to book up wool at these levels. The talk of a 20 to 30 cent fall from the outset rang true from the opening lot on Wednesday as 15 to 30 cent falls were recorded for most indicators. Other indicators such as 17.5, 18 and 19 suffered heavier losses of 35 to 45 cents even though the FNF and “Best Topmaker” style lots were dearer with 17s also in sellers’ favour. Despite this fall early in the day, the market did in fact improve as the day went on. Thursday’s offering met with similar buying patterns for the finer indicators as 17.5 to 18.5 fell 10 to 29 cents, but the better lots posted good gains. Medium types were solid with 21s adding 14 cents to their overnight values. One highlight came out of Melbourne on Wednesday with an 11.4 micron bale of shedded and coated wool from 2 year old wethers making 200,000 cents (highest price in 3 years). This bale, measuring 66mm & 41nkt was bought by G Schneider Australia for their Italian client, Lora Piana to be woven into cloth at their mill in Milan.

Unlike previous weeks, skirtings failed to maintain their good levels and followed the pattern of falling prices in the fleece room. Most descriptions opened up around 30 cents cheaper with most emphasis on 5%vm and lower. The heavier vm lots also came under pressure to fall by 50 cents. On our day’s sale (Thursday), most types remained unchanged except some short burrier types quoted cheaper by 10 to 20 cents and the usual discounts for lots with colour and cott. Cardings started the new season with a 20 to 30 cent fall for all types and vm levels on the opening day and remained at these rates on Thursday. An increased volume of Crossbreds saw all descriptions ease on both days bar the finer indicators (25 and 26s) which gained 10 to 15 cents while 28 to 32 micron lots dipped by 30 cents.

Even with the market falling, value/bale is still very good. This week’s catalogue was our biggest to date with 1962 bales offered with 1834 bales sold averaging $1460/bale. Our biggest buyer was Williams Wool buying 366 bales costing $501,244 at an average of $1370/bale with a total of 27 buyers operating on our catalogue. Next week will see Don Macdonald & Co offer 1670 bales second up on Tuesday in the final sale before the three week winter recess. A finish to the market at these levels may be the best the outcome we can hope for as a national catalogue of 59,000 bales is on offer, the largest weekly offering since mid January.     

AgRisk FDIC Indicative Quotes 08/07/11

20

21

22

AUCTION

1485.5

1425.0

1385.5

Aug-11

1456

1417

1351

Oct-11

1380

1341

1275

Dec-11

1335

1296

1230

Feb-12

1315

1276

1210

Apr-12

1270

1231

1165

Jun-12

1234

1195

1129

Aug-12

1224

1185

1119

Oct-12

1191

1152

1086

MAJOR AUCTION BUYERS (Bales)

1

Viterra Wool

5385

2

Fox & Lillie

2989

3

Williams Wool

2864

4

QLD Cotton

2531

5

Techwool Trading

1911

6

AS Gedge

1770

7

Lempriere (Aust)

1745

8

G Schneider (Aust)

1611

9

Victoria Wool Processors

1427

                       

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

                Eastern 1359 cents (ê40) compared with 30/06/11                                                1.0742 ê 0.0005 compared with 30/06/11

                Northern Market Indicators (AUD cents/kg clean)

                Northern 1409 cents (ê46) compared with 30/06/11

1 July 2011

Friday, July 01, 2011

WEEKLY MARKET REPORT

Week Ending 1st July 2011

Northern Micron Indices Comparison: Source of information: AWEX

AWEX
INDEX

This Week
01/07/11

Last Week
24/06/11

Change

Last Year
30/06/10

Yearly
Change

17

2392n

2373n

+19

1261

+1131

18

2062n

2066n

-4

1169

+893

19

1709

1751

-42

1066

+643

20

1505

1588

-83

950

+555

21

1438

1522

-84

936

+502

22

1415n

1461

-46

924

+491

23

1298n

1324n

-26

898

+400

26

900n (M)

899n (M)

+1

628

+272

28

711n

706n

+5

476

+235

30

648n

644n

+4

416

+232

32

590n

590n

0

369

+221

MC

823

831

-8

630

+193

THE CORRECTION WE HAD TO HAVE?

A reality check this week as the talk of a correction over the past few weeks came to fruition and put everyone out of their misery as the EMI gave up 27 cents to finish the season at 1409 cents. This week’s falls snapped a fifteen day rising streak with both days suffering double digit losses. The national offering of 31,300 bales was the second smallest three-centre catalogue in 12 months. The middle microns took the brunt of the falls as 19.5 to 21s slumped 70 to 85 cents. Finer categories (18.5 and 19) and 22 and 23s were back 25 to 45 cents. Superfine indicators bucked the falling trend and posted modest gains of 5 to 20 cents on the back of a good selection and renewed Italian interest. As is nearly always the case off types with heavy cott, colour and high vm were discounted greatly with the odd lot almost neglected. The reasons for this week’s falls vary from the anticipated correction discussed earlier to the rising AUD$ to larger than expected quantities over the next two weeks before the annual 3 week winter recess. It seems now that the buyer who was holding stock in China may have got his wish of a cheaper market as they had not booked up a bale for over four weeks and virtually been on the sidelines for the past fortnight. Hopefully this week’s fall allows mills to purchase some stock and stabilise the market. A rise in currency will nearly always be used as a reason for a falling market.

The skirting market was not affected nearly as much as the downward trend of the fleece room. Types containing vm levels under 5% came under renewed pressure and lifted in value by as much as 30 cents with the emphasis being on the “better” style pieces and bellies. Again, high vm lots with colour, cott and jowl were discounted heavily. After a solid opening session, cardings lost ground on the final day as fine locks and crutchings surrendered 15 to 20 cents with stains unchanged. Crossbred types bucked the falling trend adding up to 5 cents to last week’s values.

A terrific year for the wool market! A rise of just over 500 cents, (898 to1409) and most of that since November 2010. This equates to a 57% increase, outdoing the 45% rise in 1988. In US cents terms, the rise is a staggering 97.9% - 765 to 1514 cents. Just two weeks ago the rise hit 99.5 %. Incredible numbers considering the AUD$ recorded a rise of 22% (85 to 107) in 12 months. Good news, construction has finally started on our new wool store, with photos of a very relieved manager and wool store manager on our web site (www.macwool.com.au and go to ‘Weekly Market Report’). Predictions for next week look tough, but a stable market would be a good outcome.

                     

AgRisk FDIC Indicative Quotes 01/07/11

20

21

22

AUCTION

1520.0

1447.0

1419.5

Aug-11

1515

1476

1410

Oct-11

1408

1369

1303

Dec-11

1393

1354

1288

Feb-12

1305

1266

1200

Apr-12

1260

1221

1155

Jun-12

1256

1217

1151

Aug-12

1246

1207

1141

Oct-12

1213

1174

1108

MAJOR AUCTION BUYERS (Bales)

1

Viterra Wool

3605

2

Fox & Lillie

2576

3

Techwool Trading

2131

4

Modiano

1731

5

Kathaytex

1377

6

Lempriere (Aust)

1279

7

AS Gedge

1270

8

Victoria Wool Processors

1261

9

Chinatex (Aust)

943

                       

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

                Eastern 1409 cents (ê27) compared with 24/06/11                               1.0747 é 0.0199 compared with 24/06/11

                Northern Market Indicators (AUD cents/kg clean)

                Northern 1455 cents (ê36) compared with 24/06/11