Weekly Market Reports


1 February 2019

Friday, February 01, 2019

WEEKLY MARKET REPORT 

Week Ending 1st February, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S31/18

This Week

M31/18

Last Sale

S30/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2538

2508

2538

0

2705

-167

18

2437

2443

2432

+5

2330

+107

19

2304

2287

2313

-9

2090

+214

20

2273

2251

2277

-4

1901

+372

21

2249

2224

2245n

+4

1789

+460

22

-

2223n

2213n (M)

+10 (M)

1728 (M)

+495 (M)

26

1343n

1333

1298n

+45

1039n

+304

28

1024n

1031

934n

+90

718

+306

30

839n

848

741 (M)

+107 (M)

542

+297

MC

1165

1123n

1186

-21

1300n

-135

HAPPY CHINESE NEW YEAR … HOPEFULLY!

The wool market plodded along this week with mixed results in all 3 centres as national weekly offerings are now averaging 40,000 bales following on from the 2 big opening sales of the new year. The AWEX EMI pushed ahead by 7 cents to 1934 with most microns moving by single figures either way in Sydney. In US$ terms the EMI added 33 cents to 1405, this due the rising A$ as the sale progressed, up by 1.5 cents (2.2%) for the week. With the volume of drought affected wool increasing each sale only the long, low VM higher yielding types are immune from any major price discount. Buyers are finding it harder to place the burrier, tender, short and sub 60% yielding fleece types and are adjusting prices accordingly as only the best types attract solid premiums.

Skirtings also improved by modest margins - 10 to 20 cents for most types bar the very high VM lots. Again LKS weighed heavily on the carding sector as < 17 micron types were reduced by 30/50 cents with STN giving up 20 to 30 cents. The best performing of all sectors were the XBs. After an excellent opening 2 sales they were in hot demand again as finer than 26 micron added up to 50 cents while 28/30s climbed by 100 cents as some exporters are blending these with fine wools - the reason for the renewed interest as 28 micron is at a 5 year peak.

The 2 fundamentals that remain in place (supply and demand) will dictate above all which way the market goes but we do face some headwinds. The market looks to be coping with the FRX fluctuations as this sale demonstrated although new forward business is hard to come by at current market levels given the quality of wool on offer as processors try to balance the need to keep machinery running and the inability to pass the current price levels to downstream customers. Some overseas manufacturers are looking to other sources to continue processing but the move to blending XBs with merino rather than a shift to blend synthetics is working thus far. The ongoing US/China trade war, the messy Brexit in Europe and the slowing Chinese economy could all play their part at some stage on wool prices. AWTA reports that 12% less wool was tested in January 2019 compared to the same month last year and wool sold year to year is 19% (201,000) lower than last season to date. As we approach Chinese New Year, most pundits forecast good types to hold while off style wools could struggle.

Ag Concepts Fwd Prices as at 1 February 2019

Micron

Date

Low

High

21

17-Apr-19

2190

2190

21 9-Oct-19 2060 2060 

Main Buyers (This Week)

1

Techwool

4599

2

Seatech Ind.

3449

3

Fox & Lillie

3409

4

Aust. Merino

3008

5

Endeavour Wool

2678

6

Kathaytex

2467

Eastern Market Indicators (AUD cents/kg clean)

1934 cents é 7 cents compared with 25/01/2019

Northern Market Indicators (AUD cents/kg clean)

1978 cents é 8 cents compared with 25/01/2019

AUD/USD Currency Exchange

0.7267 é 0.0144 compared with 25/01/2019

25 January 2019

Friday, January 25, 2019

 WEEKLY MARKET REPORT 

Week Ending 25th January, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S30/18

This Week

M30/18

Last Sale

S29/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2538

2497

2523n

+15

2684

-146

18

2432

2434

2407

+25

2345

+87

19

2313

2283

2304

+9

2101

+212

20

2277

2246

2256

+21

1900

+377

21

2245n

2235

2225

+20

1785

+460

22

-

2213n

2202 (M)

+11 (M)

1697 (M)

+516 (M)

26

1298n

1307

1339

-41

1046

+252

28

934n

945

941n

-7

735

+199

30

-

741

719 (M)

+22 (M)

560 (M)

+181 (M)

MC

1186

1151n

1202

16

1334n

-148

LESS WOOL, LITTLE RAIN, MORE DUST

Last week’s predictions of a stronger market were spot on in most categories, particularly in the Northern market as all merino fleece micron indicators posted reasonable gains. The crossbred sector along with cardings showed some resistance - not really that surprising as 26 micron surged 134 cents in the preceding two weeks. Some analysts are saying that the Chinese are struggling to keep machinery running, some at 50% operation and are buying crossbred wool because it is cheaper hoping to sell it in blended form to keep the doors open. Seasonally, China has fallen from 76% to 71% of the offering; India has edged up to 7% with Italy 6% and Czech Republic (Modiano) with 4%.

I know we talk about lower offerings most weeks but the further we go this season the more this plays out and there is constant speculation about how the market will react as it continues to decline. One reaction we are seeing as the year unfolds is the competition on well-measured wool (particularly lower VM types) and who is buying them. In the last few weeks we have seen some well grown western division clips with good length (80-90mm) and high NKT receiving very strong competition and from buyers like New England Wool (Barberis and Reda) who normally focus on more traditional fine wool types. Many of the typical fine wools are a lot finer than normal and many under 35 NKT with high mid-breaks. Removing burry hind legs and keeping the fleece portion as low as possible is a real winner this season, if you can get it under 2%.

The other feature worth noting this season is the increasing premiums for non-mulesed wool. It’s been a long time coming but non-mulesed lines which also carry other favourable specs have been attracting greater competition from a wider audience of buyers. The other factor with these wools is that more and more of them are contracted forward so they don’t figure in the most recent price analysis.

Next week nationally 40,629 bales will be offered with just 8,929 to be offered in Sydney. Macwool will offer 746 bales on Thursday. Have a good hot Australia Day weekend!

Ag Concepts Fwd Prices as at 25 January 2019

Micron

Date

Low

High

21

22-May-19

2165

2165

 21  26-June-19 2150 2160 

Main Buyers (This Week)

1

Techwool

4187

2

Seatech Ind.

4005

3

Tianyu

3609

4

Modiano

2961

5

Aust. Merino

2907

6

Kathaytex

2141

Eastern Market Indicators (AUD cents/kg clean)

1927 cents é 4 cents compared with 18/01/2019

Northern Market Indicators (AUD cents/kg clean)

1970 cents é 10 cents compared with 18/01/2019

AUD/USD Currency Exchange

0.7123 ê 0.0028 compared with 18/01/2019

18 January 2019

Friday, January 18, 2019

WEEKLY MARKET REPORT 

Week Ending 18th January, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S29/18

This Week

M29/18

Last Sale

S28/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2523

2508

2557n

-34

2672

-149

18

2407

2438

2435

-28

2374

+33

19

2304

2286

2296

+8

2137

+167

20

2256

2234

2240

+16

1942

+314

21

2225

2233

2200

+25

1786

+439

22

-

2202n

2204 (M)

-2 (M)

1699 (M)

+503 (M)

26

1339n

1341

1259n

+80

1128

+211

28

941n

954

886n

+55

808

+133

30

739n

719

706 (M)

+13 (M)

594 (M)

+145 (M)

MC

1202

1172n

1179

+23

1513n

-311

BUYERS ABSORB BIG VOLUME!

Despite the largest national offering of the season to date (51,700 bales) the market absorbed the excess volume easier than most pundits thought. As far as the merino fleece sector was concerned, it was a sale of contrasts as finer types        <18.5 fell by 10 to 35 cents due mainly to the sub-standard quality of the offering feeling the effects of the drought, bar the lots with the “right specs” that were 25 to 120 cents dearer than their indicators. The 19s and coarser improved by 10 to 25 cents. The AWEX EMI gained 13 cents to 1923 helped along by the rises in fine XBs and merino cardings and skirtings.

Skirtings had a solid sale as all types and descriptions were 10 to 20 cents to the good. Cardings kept their momentum going from last sale as all types added 15 to 30 cents to their previous values to put the MCI in Sydney at 1202 cents. Crossbreds also had another stellar sale to follow on from last series as 28s and finer climbed by 50/80 cents.

Speculation of supply concerns is all the talk on the showfloor, too much in these opening 2 sales and a sharp decline for the next 4 weeks. As we stand at the present time there has been 175,000 bales less offered than the same time last season, a 17% decline or about 4 sales!! A telling factor of the 2 sales since the new year was the re-emerging of one of the bigger local trading companies taking on the Chinese indent buyers to see price levels in the medium types benefit from an increase in competition as price determination in the finer sector is now truly driven by poor quality and a rise in volume due to the drought.

The fine XB sector (25 to 28 micron) has had the largest increases of any type recently, 100 cents. The main reason is Australia is still the primary source of “good white” wools in this category and mills can keep combing machinery running at similar settings to full length merino fleece types. At the other end of the market carding wools look to be back in favour as well. European retailers are reporting improving winter sales after a slow start to the season. Hopefully the recent blast of cold weather can keep sales ticking along. Next week has quantities falling back to 41,000 bales with all the talk being a solid to dearer market.

Ag Concepts Fwd Prices as at 18 January 2019

Micron

Date

Low

High

21

12-Jun-19

2150

2160

Main Buyers (This Week)

1

Techwool

5956

2

Seatech Ind.

4106

3

Fox & Lillie

4097

4

Aust. Merino

3344

5

Tianyu

3242

6

PJ Morris

3242

Eastern Market Indicators (AUD cents/kg clean)

1923 cents é 13 cents compared with 11/01/2019

Northern Market Indicators (AUD cents/kg clean)

1960 cents é 12 cents compared with 11/01/2019

AUD/USD Currency Exchange

0.7151 ê 0.0028 compared with 11/01/2019

11 January 2019

Friday, January 11, 2019

WEEKLY MARKET REPORT 

Week Ending 11th January, 2019

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S28/18

This Week

M28/18

Last Sale

S24/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2557n

2524

2532

+25

2635

-78

18

2435

2415

2402

+33

2389

+46

19

2296

2291

2247

+49

2164

+132

20

2240

2254

2178

+62

1976

+264

21

2200

2240

2145

+55

1808

+392

22

-

2204n

2155 (M)

+49 (M)

1723 (M)

+481 (M)

26

1259n

1288

1205n

+54

1143

+116

28

886n

898

855n

+31

818

+68

30

-

706

693n (M)

+13 (M)

596 (M)

+110 (M)

MC

1179

1178n

1146

+33

1544n

-365

OFF TO A FLYING START!

Buyers hit the market with a vengeance to kick off the 2nd half of the selling season after the 3 week Christmas recess. With the A$ commencing the new year at 70 cents (a fall of 2.30 cents from Sale 24) and dipping below that point for a night last week, most Chinese mills were keen to book up wool at the more favourable FRX. Despite the large forecast offering of 50,000+ bales (47,600 was the final figure offered) the market was dearer from the outset only to drift fractionally in the final session in Sydney and Fremantle when the FRX edged higher to its pre-Christmas level. Medium and broad types (19 to 23s) performed the best climbing 50 to 65 cents while finer microns added 15 to 35 cents as the AWEX EMI rose by 48 cents to 1910 and by 25 cents to 1371 in US$. The market in Euros and Chinese Yuan only rose less than 1% illustrating not all mills had to extend themselves from the pre-Christmas levels to buy wool.

Skirtings also kept pace with their fleece counterparts as all types and descriptions across all microns looked 30 to 40 dearer. Cardings recouped their losses from S24 as the 3 regional indicators averaged 35 cent increases as LKS/STN lifted by 35 to 40 cents. Crossbreds were back in favour to recover some of their heavy losses from early December as most microns added 30 to 70 cents despite the large quantity on offer this week - 27% of the national offering and a whopping 37% of the Melbourne catalogues were crossbred types.

A great start to the year is not uncommon as for several past Januaries the market has staged a very good rally in any of the 3 opening sales of the year. Can this week’s rise be sustained or even increase?? Opinion is divided. On one hand demand is good and the need to keep machinery running after 3 weeks of not buying wool is critical. On the flip-side, next week’s national catalogue of 54,000 bales could be the largest of the season so far and the FRX has recovered to 71.85, a figure that might look a bit too high to do business with so much wool to pick from. Year on year comparisons has just 735,000 bales sold against 935,000 last season - a massive drop of 21% in 6 months. AWTA figures show 161.3mkg tested this season to date down from 183.3mkg last season. We sell early next Thursday and, hopefully, the market can hold till then.

  Ag Concepts Fwd Prices as at 11 January, 2019

Micron

Date

Low

High

21

27-Mar-19

2160

2160

21

8-May-19

2150

2150

Main Buyers (This Week)

1

Techwool

6210

2

Fox & Lillie

5207

3

Aust. Merino

2945

4

Modiano

2696

5

Endeavour Wool

2696

6

Tianyu Wool

2504


Eastern Market Indicators (AUD cents/kg clean)

1910 cents é 48 cents compared with 14/12/2018


Northern Market Indicators (AUD cents/kg clean)

1948 cents é 42 cents compared with 14/12/2018


AUD/USD Currency Exchange

0.7179 ê 0.0049 compared with 14/12/2018

     

14 December 2018

Friday, December 14, 2018

 WEEKLY MARKET REPORT 

Week Ending 14th December, 2018

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S24/18

This Week

M24/18

Last Sale

S23/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2532

2500

2513

+19

2538

-6

18

2402

2371

2379

+23

2300

+102

19

2247

2248

2218

+29

2086

+161

20

2178

2188

2147

+31

1883

+295

21

2145

2156

2129

+16

1745

+400

22

-

2155n

2140 (M)

+15 (M)

1633 (M)

+522 (M)

26

1205n

1229n

1205

0

1115

+90

28

855n

863

855

0

785

+70

30

-

693

683n (M)

+10 (M)

600 (M)

+93 (M)

MC

1146

1138n

1183

-37

1470

-324

WISHING ALL A VERY MERRY WET, WET CHRISTMAS!!

The final sale of the year delivered good news and an early Christmas present for growers that had wool in as all sectors recorded lifts bar cardings. The AWEX EMI added 13 cents to its value to finish the year at 1862 - a 100 cent (5.8%) increase from 12 months ago and, in US$ terms, almost identical at 1346. All microns regardless of style, VM and other faults were in good demand, all posting 15 to 30 cent rises with the odd lot with outstanding specs or non-mulesed up to 50/100 cents better than their indicators.

Skirtings also went well with a solid opening day to edge higher in the final session by 10 cents. As mentioned earlier cardings were the only sector to finish in negative territory as all types gave up 35 to 50 cents resulting in the 3 centres averaging 44 cent falls with the MCIs ranging from 1146 to 1105 cents - a disappointing end to the year after the previous 3 sales saw increases of 180 cents. Crossbreds put aside the past 3 erratic sales as most microns gained 10 to 15 cents.

The anticipated larger offering didn’t faze buyers as purchasing patterns returned to some form of normality as the biggest trader flexed their muscle and other companies were forced to follow suit. Techwool Trading bought over 6,500 bales, costing over $13m. The biggest indent buyer was also in the market concentrating on merino fleece types only with other local trading houses competing against them but not pushing them to extreme levels that would be out of reach of their client’s ability to pay the desired price. Also not to be out-done was China’s biggest top-maker who was looking to build inventory for the upcoming 3 week recess and Europe’s largest top-maker who dominated the lower spec types and crossbreds and skirtings.

A spectacular year for the market as the highs of June (2073) and August (2089) were offset by the low point of 1776 in early November. This was the cheapest point for cardings (1020) while their peak was 1563 cents in mid September. We wish all our clients a Merry Christmas and Happy New Year with drought breaking rains the best Christmas present we could all wish for. Wool sales resume on 9th January, 2019.

Main Buyers (This Week)

1

Techwool

6507

2

Tianyu

4005

3

Fox & Lillie

3791

4

Aust. Merino

3505

5

Kathaytex

2457

6

Seatech Ind.

2423


Eastern Market Indicators (AUD cents/kg clean)

1862 cents é 13 cents compared with 7/12/2018


Northern Market Indicators (AUD cents/kg clean)

1906 cents é 9 cents compared with 7/12/2018


AUD/USD Currency Exchange

0.7228 é 0.0003 compared with 7/12/2018

 
 

7 December 2018

Friday, December 07, 2018

WEEKLY MARKET REPORT

Week Ending 7th December, 2018

 AWEX Northern Micron Indices Comparison


AWEX INDEX

This Week

S23/18

This Week

M23/18

Last Sale

S22/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2513

2445

2487

+26

2477

+36

18

2379

2326

2372

+7

2273

+106

19

2218

2202

2188

+30

2015

+203

20

2147

2156

2141

+6

1794

+353

21

2129

2133

2129

0

1669

+460

22

-

2140n

-

-1 (M)

1564 (M)

+576 (M)

26

1205

1244n

1335n

-130

1064

+141

28

855

850

-

-

772

+83

30

703n

683

-

-

571

+132

MC

1183

1174n

1199

-16

1433

-250

PENULTIMATE SALE DELIVERS ... NOT MUCH!

When looking at the AWEX EMI it’s hard to imagine little change with the 11 cent fall to 1849 cents but there were many twists and turns in the different sectors as XBs contributed to the slight fall. By week’s end the merino fleece sector had made some reasonable gains, up to 30 cents with some finer, lower style types over 2% VM commonly 50/60 cents to the good.

After a slow start merino skirtings came home with a wet sail again with gains similar to the fleece sector, up to 30 cents. Cardings took a breather from their rapid rises of a few weeks ago losing what they gained last series as all types retreated by 30 cents. After a few sales of whirlwind rises buyers put the brakes on any further gains in the XB sector citing the last series’ jumps too much as most microns lost 70 to 130 cents. The “fake fur” order that led to the sudden rises is still in place and will come into play again in January. Another reason for the fall could’ve been the sudden lift in volume of XBs particularly in Melbourne where only 17% of the Room 2 wools were merino PCS and BLS.

A good sale for merino growers as these types look to be building momentum again. The main Chinese indent buyer was again quiet but local traders filled this void to out-bid him on most occasions operating on a strict buy-in level price, not their usual method of purchasing.  Australia’s biggest buyer, Techwool Trading, flexed their muscle to buy 16% of the total sold this sale buying twice the volume of the next buyer on Thursday.

The sharp decline in the FRX from almost 74 cents on Monday to below 72 cents on Thursday - a 2 cent fall - was too late to help the markets on the Eastern seaboard but did benefit the Fremantle market, up by 20 to 45 cents on Thursday. The release of Australia’s poor GDP figures and trade issues between China and the USA saw financial markets tumble and currencies react. Next week sees the final sale of the year with 48,000 bales on offer - the largest sale since early August. Hopefully buyers will need to buy and ship wool to keep machinery running in January.

Ag Concepts Fwd Prices at 7 December 2018

Micron

Date

Low

High

21 12-Dec-18 2125 2125
21 6-Mar-19 2100 2100

Main Buyers (This Week)

1

Techwool

5405

2

Aust. Merino

2802

3

Tianyu

2800

4

Fox & Lillie

2691

5

Endeavour Wool

2233

6

PJ Morris

1970


Eastern Market Indicators (AUD cents/kg clean)

1849 cents ê 2 cents compared with 30/11/2018

Northern Market Indicators (AUD cents/kg clean)

1897 cents ê 8 cents compared with 30/11/2018

AUD/USD Currency Exchange

0.7225 ê 0.0090 compared with 30/11/2018

30 November 2018

Friday, November 30, 2018

WEEKLY MARKET REPORT

Week Ending 30th November, 2018

 AWEX Northern Micron Indices Comparison


AWEX INDEX

This Week

S22/18

This Week

M22/18

Last Sale

S21/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2487

2426

2472

+15

2459

+28

18

2372

2315

2343

+29

2270

+102

19

2188

2195

2204

-16

1999

+189

20

2141

2152

2172

-31

1773

+368

21

2129

2138

2158

-29

1649

+480

22

-

2141n

2144 (M)

-3 (M)

1561 (M)

+580 (M)

26

1335n

1359

1245n

+90

1035

+300

28

-

946

861n (M)

+85 (M)

734 (M)

+212 (M)

30

-

753

734 (M)

+19 (M)

536 (M)

+217 (M)

MC

1199

1181

1180

+19

1382n

-183

MARKET MARKS TIME

After last series’ big lift the market consolidated with no shift in the AWEX EMI to stay at 1860. The Sydney market managed a 2 cent gain while Melbourne lost 2 cents to come to that unchanged figure - a good result considering the FRX went against the A$ by 1%, this reflected in the rise of the EMI in US $ terms by exactly that amount, 13 cents to 1360. On the surface the market was unchanged but there were some very mixed results across the different categories. The fleece sector saw some subtle movements with the final designated super-fine sale of the year helping the sub 18.5 micron types post gains up to 30 cents and for the “Italian/European” types (spinners and better) premiums were in the order of 200/300 cents with some < 16.5 micron types even with very poor strength readings were 30 to 80 cents higher. Broader microns from 19 couldn’t maintain their big increases of last sale and lost 15 to 30 cents - buyers citing last Thursday’s push of 20/40 cents as too much after absorbing Wednesday’s price rises as plenty of business had been done that night after that day’s good gains.
Skirtings also benefitted from the superior selection on offer as these finer, low VM types lifted by 10 to 20 cents with some up to 50 cents to the good. Cardings also were quoted dearer helped along by the better offering as fine LKS < 17.5 micron looked 20 to 50 cents dearer with all other types of cardings solid. The Crossbred sector was the stand–out for the week as 26 to 28 micron shot up 80 to 90 cents. This push that started last sale has come about from some large “fake fur” orders being placed in China that uses 25.5 to 27.5 micron wools but these rises may be short lived as requirements may be filled pre-Christmas or early in the New Year.

The absence of the biggest Chinese indent trader did see prices falter early but other buyers soon filled the void to secure volume as well as local traders and one of China’s larger top-makers. A major talking point was quota issues in China with their allocation of 300 million greasy kgs of all wool allowed to be imported rumoured to be fulfilled. We have retained our share of that quota with end of September figures showing a 1% decrease of volume imported year on year. Fresh quotas will be issued in a month and, given the 3 week recess is almost upon us, little impact is expected if quotas have, in fact, closed off for the calendar year. After last week’s rise 40,000 bales are on offer next week and the final sale before Christmas could see close to 50,000 bales for sale.

Main Buyers (This Week)

1

Techwool

4543

2

Fox & Lillie

3226

3

Tianyu

2820

4

Endeavour wool

2567

5

Aust. Merino

2367

6

Lempriere

1927

7

Kathaytex Aust.

1678

8

Michell Aust.

1656

9

PJ Morris

929

Eastern Market Indicators (AUD cents/kg clean)

1860 cents é 2 cents compared with 23/11/2018

Northern Market Indicators (AUD cents/kg clean)

1905 cents é 7 cents compared with 23/11/2018

AUD/USD Currency Exchange

0.7315 é 0.0063 compared with 23/11/2018

23 November 2018

Friday, November 23, 2018

WEEKLY MARKET REPORT

Week Ending 23rd November, 2018

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S21/18

This Week

M21/18

Last Sale

S20/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2472

2448n

2445

+27

2460

+12

18

2343

2319

2278

+65

2277

+66

19

2204

2210

2104

+100

1985

+217

20

2172

2164

2057

+115

1758

+414

21

2158

2159

2048

+110

1636

+522

22

-

2144n

-

+59 (M)

1548n (M)

+596 (M)

26

1245n

-

1140n

+105

1055

+190

28

845n

861

760

+85

731

+114

30

-

734

663n

+50 (M)

539 (M)

+195 (M)

MC

1180

1183n

1100

+69

1381n

-201

AT LONG LAST, THE MARKET LIFTS

Finally, after weeks of showfloor chatter of a recovery in the market, it did happen!! Hopes were high after the last series’ modest rises that the market could get some serious traction and recoup the recent losses. Whether it be the lower quantities on offer, the fall in the FRX from the Tuesday night high of 73.35 cents to 72.3 before sales commenced, the latest release of wool production forecasting figures or just that the market had fallen enough and the Chinese deemed it was time to step back in and start to buy again is anyone’s guess.

Whatever the reason it was a dearer market in all sectors. The AWEX EMI clawed back 77 cents to 1858 led by the medium wool types (19 to 22s) up by 100 to 120 cents. Finer microns were dearer but not to the extent of their broader cousins, still hindered by oversupply and poor quality, 18/18.5 jumped by 60 to 70 cents while < 18 could only find 15 to 30 cent gains as discounts for any fault shrunk as 97.6% of fleece lots were sold in Sydney.

The positive tone also extended to Room 2 as skirtings, regardless of VM, style or micron added 40 to 80 cents to their values. It was another good sale for cardings as they jumped an identical amount to last series, 80 cents to 1180 as all types posted 50 to 80 cent rises. Crossbreds weren’t to be outdone either as < 28s climbed by 85 to 110 cents while broader than 30 microns looked up to 50 cents to the good.

As mentioned above whatever it takes for the market to rise is welcome but a major factor could have been the latest release of figures by the Wool Production Forecasting Committee that met last week, a month ahead of schedule due to global concern of supply in Australia. The new forecast came in at 305mkg for the current season, down from the 322mkg that was predicted at their August meeting and back by 11% on the 341mkg from last season. These figures are backed up by the AWTA stats that are 9.7% behind last year’s totals to the end of October and offerings are 17% (136,800 bales) lower than to the same sale last year. NSW production is predicted to fall by 20% this season to 100mkg, the lowest since 1902 with some brokers talking of a 25% reduction of wool through their stores by July next year. Alarming stats indeed! Talk of the market keeping this momentum is all the rage with only 3 sales before Christmas buyers need to deliver wool to their mills promptly to process in the new year with the 3 week recess looming.


Ag Concepts Fwd Prices at 23 November 2018

Micron

Date

Low

High

21

20-Feb-19

2100

2100

 21 22-May-19 2050 2050

Main Buyers (This Week)

1

Tianyu

3719

2

Techwool

3469

3

Endeavour Wool

2956

4

Fox & Lillie

2686

5

PJ Morris

1916

6

Michell Aust.

1658

7

Seatech Ind.

1148

8

Aust. Merino

1082

9

Modiano

846

Eastern Market Indicators (AUD cents/kg clean)

1858 cents é 77 cents compared with 16/11/2018

Northern Market Indicators (AUD cents/kg clean)

1898 cents é 79 cents compared with 16/11/2018

AUD/USD Currency Exchange

0.7252 ê 0.0021 compared with 16/11/2018

16 November 2018

Friday, November 16, 2018

WEEKLY MARKET REPORT

Week Ending 16th November, 2018

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S20/18

This Week

M20/18

Last Sale

S19/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2445

2403

2495

-50

2494

-49

18

2278

2248

2318

-40

2303

-25

19

2104

2100

2109

-5

2009

+95

20

2057

2071

2050

+7

1783

+274

21

2048

2058

2043

+5

1647

+401

22

-

2085n

-

-15 (M)

1548n (M)

+537 (M)

26

1140n

1126

1143n

-3

1075

+65

28

760

765

745n

+15

768

-8

30

663n

684

636n

+27

584

+79

MC

1100

1114n

1020

+80

1382n

-282

WOOLGROWERS VOTE FOR 1.5%

The recent Woolpoll voting results have finally been released after the closest vote on record. Like most political elections, preferences had to come into play to determine a winner as first-hand results were too close to call between the 2 favoured options, 1.5% and 2%. After the final tally of preferences the 1.5% levy won by 52.5% over 47.5% for the current rate of 2% to be retained. Despite the call for the levy to be held at 2% from AWI, various industry groups lobbied for the lower option despite the forecasted less revenue due to less wool being sold and with less finances coming in putting some projects at risk. The new levy will commence from July 2019.      

For just the 4th time in 13 weeks - since the big rise in mid August - the AWEX EMI took a turn for the better, with a modest 5 cent gain to 1781. Talk of a recovery or the market bottoming out has been in the wings for 2-3 sales now but only came to fruition this sale due mainly to a buoyant XB and carding market. The large volume of dusty, fine and tender types < 19 micron saw these wools lose 35 to 55 cents whereas the odd lot with “good specs” gained 40 to 60 cents. Broader microns managed to hold their ground to finish in sellers’ favour. A much higher acceptance of these current prices by growers saw just 6% of the Sydney fleece catalogue passed-in.

The big movers in the market were in Room 2. Skirtings had an up and down sale as the opening day’s losses of 20 to 30 cents were regained in the closing session to see this sector finish unchanged to sellers’ favour. The big mover was the carding sector. After getting hammered since the record peak of 1563 cents in mid September to last sale’s low of 1020 (a 543 cent collapse – 35%) the 3 centres averaged a 90 cent gain as all types in this sector added 50 to 150 cents to their previous values. Crossbreds were also buoyed by the renewed buyer competition increasing by up to 30 cents.

Could this finally be the bottom of this price cycle? It may well be if all other sectors follow the lead of cardings as a Chinese delegation was here this week and were keen to purchase carding types having been out of the market for several weeks. Also of note was the lift in prices of inferior fleece types by 40 cents late in the final session. The market in Euro terms gained 1.1% even with the ascendency in this currency by 3.5% over the past 3 weeks indicating increased support for the better European types despite China’s absence from the market. Many “good judges” are predicting a dearer market through to Christmas - hope their on the money!!

Ag Concepts Fwd Prices at 16 November 2018

Micron

Date

Low

High

21

5-Dec-18

1990

1990

 
21

22-May-19

1910

1910

Main Buyers (This Week)

1

Techwool

3842

2

Tianyu Wool

3232

3

Endeavour Wool

2641

4

Fox & Lillie

2420

5

Seatech Ind.

2367

6

Aust. Merino

2252

7

PJ Morris

1881

8

Vic. Wool Proc.

1012

9

Kathaytex

825

Eastern Market Indicators (AUD cents/kg clean)

1781 cents é 5 cents compared with 9/11/2018

Northern Market Indicators (AUD cents/kg clean)

1819 cents é 10 cents compared with 9/11/2018

AUD/USD Currency Exchange

0.7273 ê 0.0005 compared with 9/11/2018

9 November 2018

Friday, November 09, 2018

WEEKLY MARKET REPORT

Week Ending 9th November, 2018

 AWEX Northern Micron Indices Comparison

AWEX INDEX

This Week

S19/18

This Week

M19/18

Last Sale

S18/18

Sydney

Change

Last Year

Sydney

Sydney Yearly

Change

17

2495

2387

2555

-60

2488

+7

18

2318

2207

2377

-59

2283

+35

19

2109

2107

2238

-129

2005

+104

20

2050

2056n

2153

-103

1764

+286

21

2043

2064n

2139

-96

1645

+398

22

-

2100n

-

-69 (M)

1560 (M)

+540 (M)

26

1143n

1119

1189n

-46

1103

+40

28

745n

751

778

-33

815

-70

30

636n

670

661n

-25

616

+20

MC

1020

1045n

1045

-25

1348n

-328

THE END OF AN ERA AT AWI

AWI Chairman, Wal Merriman announced today that he had stood down as Chairman of the company after 13 years in the top job. His decision came just prior to the AGM in two weeks time to allow the incoming Chair, Colette Garnsey, time to prepare for the next busy year. Wal’s contribution has been enormous and one hopes his tenure is remembered as one who steered and guided the company back into marketing and putting wool back on the stage in the world fashion industry. He leaves his position with the company in a strong financial position with a list of many significant achievements for the wool grower shareholders.

It seems nothing at the moment can influence the buyers into a positive change of sentiment as the market lurched further into negative territory. Each region recorded similar losses (74 to 82 cents) as the AWEX EMI retreated to the tune of 78 cents to 1776. In US$ terms the fall was not as severe, a 29 cent fall to 1293 this due the FRX ascending against the A$ by 1.5 cents. Even though falls were across the board, fortunes were reversed from the previous few sales as the < 18.5 micron escaped the bigger losses of their broader counterparts (45 to 70 cents) as 19 and coarser collapsed by 95 to 130 cents - a sign that the gap between the fine and broad microns was too close as in the past few sales the <19 micron have been falling dramatically and broader types not so. Only the very best style lots with good length and strength results escaped the carnage giving up 20/40 cents.

Skirtings also came under the pump as losses across all microns, VM, styles and lengths totaled another 50 to 100 cents. Cardings again copped a caning as some buyers were still sitting on the side-lines as all types in this sector were quoted 60 to 100 cents behind the previous series. Crossbreds took reasonable hits as well with a cut-off point around 26 micron. Finer than this the falls ranged from 50 to 100 cents while coarser types were adjusted down by 20/30 cents.

After last series relatively minor falls talk of the falling market reversing its fortunes was widespread. That was until the FRX shifted in favour of the 3 major wool trading destinations as the A$ jumped and buyers let the market freefall again. Talk is still strong that the market is very close to the bottom.

Ag Concepts Fwd Prices at 9 November 2018

Micron

Date

Low

High

21

23-Jan-19

1980

1980

21 8-May-19  1910 1910 

Main Buyers (This Week)

1

Endeavour Wool

2548

2

Fox & Lillie

2531

3

Tianyu Wool

2411

4

Techwool

2383

5

Seatech Ind.

2094

6

PJ Morris

1823

7

Aust. Merino

1507

8

Michell Aust.

714

9

G Schneider

668

Eastern Market Indicators (AUD cents/kg clean)

1776 cents ê 78 cents compared with 2/11/2018

Northern Market Indicators (AUD cents/kg clean)

1809 cents ê 82 cents compared with 2/11/2018

AUD/USD Currency Exchange

0.7278 é 0.0149 compared with 2/11/2018