AUSTRALIAN WEEKLY MARKET REPORT

Comment

Sales have concluded for the 2018/2019 season on a relatively poor tone, albeit with prices still at reasonably good levels for wool production. The market this season has taught us that nothing is for certain. Chinese demand changed from fine wool to crossbreds very quickly and then the market appetite for wool altogether changed quite suddenly in recent weeks. The focus on non mulesed wool has improved dramatically, almost to a point that NM certified wool according to the National Wool Declaration is creating its own market and not following the trend of the other types on offer. There have been some very high-quality NM wool clips on offer that are still attracting widespread support from a different demand base and this is protecting those types more than others, from the current market instability.

AWEX Eastern Indicator compared with 20/06/2019

Eastern Indicator

Close: 1715

Change in % -2.88%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 20/06/2019

↓15 Micron

Close: 2,403

Change in %: -2.70%

↓16 Micron

Close: 2,137

Change in %: -3.23%

↓17 Micron

Close:  2,159

Change in %: -0.46%

↓18 Micron

Close: 2,055

Change in %: -0.39%

↓19 Micron

Close: 2,047

Change in %: -2.39%%

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

The ups and downs of this season must be a warning to wool producers that they should be looking to align themselves as much as possible with their customers demands. The interest in relationships and traceability back to farm is increasing.

The current market trend seems more a global issue and not focused only on wool. Consumer confidence as a result of political positioning is affecting business confidence and the attitude towards investment and risk. This is no doubt affecting wool that has a long supply chain and a very high level of investment for all involved. Two weeks of sales remain before our three-week mid-year recess.

Auction offering – current week

Selling Centres for week

Market          Sale          Offered             Sold       Passed In

North                    S 52                      7859                          6526                 17.0%

South                   M 52                     14995                        12513                 16.6%

West                     F 52                        6313                          4293                 32.0%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 01                        W-T                          13608

South                      M 01                       W-T                          12127

West                        F 01                        W-T                           8769

 

If you want to see the complete Wool Sales Roster click here.

NEW ZEALAND MARKET REPORT

Summary

Clean up offering for the final sale of the 2018/2019 season.

Comment

There was a very miscellaneous selection of finer wools available this week in New Zealand reflecting an end of season clean up before the short recess.  Prices for the wools on offer again reflected the recent movements of prices in Australia, but there was still good competition at these levels.

FUHRMANN NZ MARKET REPORT

Summary

Fleece firm, second shear and oddments easier.

Comment

North Island offering 8,500 bales and South Island offering 12,000 bales.  The selection in the North Island was dominated by good colour second shear 3″, 33.0 to 40.0 micron.  The South Island offering was dominated by average colour fleece 3/5″ to 4/6″, 35.0 to 40.0 micron with associated oddments for both markets.  Reasonable competition with Australasian carpet mills, South East Asia main and support from United Kingdom, Continent and China.  This was the final auction of the 2018/2019 season.

Fleece Wools

Good colour crossbred fleece firm.

Poorer style crossbred fleece firm.

Second Shears

All descriptions 10 cents cheaper.

Oddments

All descriptions generally 10 cents cheaper.

Passings

20% Passed In.

Next Auction

North Island only selling with 10,000 bales on offer 11th July.

Fleece Wools Summary

Good colour
Variation %: Firm

Poorer style
Variation %: Firm

Second Shears Summary

↓ All descriptions

Variation %:  -10 cents

Oddments

↓ All descriptions
Variation %: -10 cents

 

EASTERN AUSTRALIAN MARKET REPORT

Non Mulesed (NM) wool unchanged. All others cheaper.

COMMENT

More widespread demand from end users for non mulesed (NM) wool as per the National Wool Declaration is protecting those lots from the continuing downward trend.

FLEECE

NM wool in good supply, unchanged.

All others 2% cheaper and very irregular. Poor overall competition.

SKIRTINGS

Nominally 2% easier.

OPEN TOP

Nominally 1 to 2% easier.

EASTERN AUSTRALIAN MARKET REPORT

Market easier in another poor selection.

COMMENT

The last sale of the season has drawn out some poor quality wool types.

FLEECE

18.5 micron and finer generally 1 to 2% easier with the finest and most inferior types most affected.

19.0 / 20.5 micron 1% easier.

21.0 / 22.0 micron par to 1% easier in a small selection.

SKIRTINGS

Generally 1% easier with finest lots most affected.

OPEN TOP

Nominally 1% easier.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

When we have exceptionally small national quantities, the market is often neglected and this was the case this week. Not only were the volumes small (19,000 bales offered), the selection was again very poor. A large percentage of very low yielding, drought affected types. These wools are not only inferior in quality, they are more expensive to transport with less clean weight per bale and processing tariffs on lower yielding types are higher. The range of price between microns is now small with little discount down to 21.5 micron. This should help to limit further downside on the fine types and it was more noticeable on Thursday that the level of interest had improved at this lower basis. This however has unfortunately been the trend in recent weeks. The opening day lower, the second day firm.

AWEX Eastern Indicator compared with 14/06/2019

Eastern Indicator

Close: 1766

Change in % -3.13%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 14/06/2019

↓15 Micron

Close: 2,468

Change in %: -1.05%

↓16 Micron

Close: 2,206

Change in %: -2.13%

↓17 Micron

Close:  2,169

Change in %: -0.32%

↓18 Micron

Close: 2,063

Change in %: -2.62%

↑19 Micron

Close: 2,096

Change in %: +1.34%

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

The wool prices in USD must now appear much more attractive. The AWEX EMI in USD terms is now at the lowest level since October 2017. We know how limited supply will be in the next season, the lowest in almost 100 years. All we need is for a little more confidence to return to the market. Buyers and traders are also reluctant to sell too far forward with concerns over supply and cash flow must be restricting many participants. Of increasing concern to Australian wool producers must be the appetite of our clients to source a lot more merino wool from other country origins now when compared to a few years ago. There is no doubt that this is a mulesing issue but we are also seeing a push from global brands on environmental standards and accountability.

Auction offering – current week

Selling Centres for week

Market          Sale          Offered             Sold       Passed In

North                    S 51                      8098                          7123                 12.0%

South                   M 51                     10974                          9511                 13.3%

West                     F 51                      no sale

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 52                        W-T                          8073

South                      M 52                       W-T                         15573

West                        F 52                        W-T                          7226

 

If you want to see the complete Wool Sales Roster click here.

EASTERN AUSTRALIAN MARKET REPORT

Improved market sentiment.

COMMENT

Slightly dearer trend on average and less than 10% were passed in. Non Mulesed (NM) wool less affected by this week’s easing trend.

FLEECE

Better lots with good yields very firm. Keenest demand is on 17.0/18.5 micron from Italian interests. These are dearer than equivalent lots 16.0/16.5 micron.

Good to average specification –

16.5 micron 1% easier

17.0 / 18.5 micron unchanged

19.0 / 21.5 micron par to 1% dearer

SKIRTINGS

Generally firm, tending slightly dearer for the better lots.

OPEN TOP

Unchanged in a small selection.

FUHRMANN NZ MARKET REPORT

Summary

Market generally easier.

Comment

North Island only selling today with 9,000 bales on offer.  The selection consisted of 70% crossbred second shear 75/100mm and shorter, good colour, 35.0 to 40.0 micron, 20% associated oddments and 10% miscellaneous types.  Reasonable competition with Australasian carpet mills, South East Asia main and support from United Kingdom, Continent and China.

Second Shears

Good colour 5.5% cheaper.

Poorer style buyers favour.

Oddments

Better colour 5.5% dearer.

Poorer style firm.

Passings

16% Passed In.

Next Auction

North and South Island selling with 18,000 bales on offer 27th June.

Second Shears Summary

↓ Good colour

Variation %:  5.5

↓ Poorer style

Variation %:  Buyers favour

 

Oddments

Better Colour
Variation %: 5.5

– Poorer style
Variation %: Firm

EASTERN AUSTRALIAN MARKET REPORT

Market easier. Yield having a strong influence in a poor quality offering.

COMMENT

Around 18% passed in.

FLEECE

Better lots with good yields 1 to 2% easier

Good specification 2% easier

Yield related inferior types, tender, dusty fleece 2 to 3% easier.

SKIRTINGS

Up to 2% easier and irregular

OPEN TOP

Nominally 2% easier

AUSTRALIAN WEEKLY MARKET REPORT

Comment

Demand slowed again this week as the small offering as well as the still drought affected wools are having an impact. With a large percentage of the offering having poor spec and very low yield, exporters are finding these types harder to place orders. These poorest style wools saw the largest loss over the week. Growers were very resistant to the fall in prices with 21.3% of the entire offering passed in. The better spec and yielding wools were less affected, whilst those with best style were barely affected as a real gap has begun to emerge between quality.

AWEX Eastern Indicator compared with 07/06/2019

Eastern Indicator

Close: 1823

Change in % -2.20%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 07/06/2019

↓15 Micron

Close: 2,494

Change in %: -1.84%

↓16 Micron

Close: 2,253

Change in %: -2.35%

↓17 Micron

Close:  2,176

Change in %: -2.48%

↓18 Micron

Close: 2,117

Change in %: -2.36%

↓19 Micron

Close: 2,068

Change in %: -1.06%

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

Sales will take a break once again this week in Fremantle seeing the national offering drop back again to just 19,745.

As the drought continues across much of NSW and QLD the generally poor offering will continue for the foreseeable future. There is a generally small national offering forecast for the next couple of weeks leading into the three week recess. Hopefully this can stimulate the market a little as buyers need to complete orders and look to have enough wool to keep the machines running through the recess.

Auction offering – current week

Selling Centres for week

Market          Sale          Offered             Sold       Passed In

North                    S 50                      7923                          6841                  13.7%

South                   M 50                     14256                        11757                 17.5%

West                     F 50                      5961                          3562                  25.0%

 

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 50                        W-T                          8327

South                      M 50                       W-T                          11418

West                        No Sale

 

If you want to see the complete Wool Sales Roster click here.