AUSTRALIAN WEEKLY MARKET REPORT

Comment

With only 18,000 bales offered nationally, the market was relatively stable. Only 14,000 bales were eventually sold. The biggest issue was the strengthening value of the Australian dollar against the US currency since the previous auction. The AWEX EMI was 3.9% dearer in USD value yesterday. Low yielding dusty wool types continue to dominate the selection.

AWEX Eastern Indicator compared with 09/04/2020

Eastern Indicator

Close: 1292

Change in % -0.69

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

Authentico Index Values

15 Micron

Close: 2430

Change in %:  unch

16 Micron

Close: 2153

Change in %: unch

17 Micron

Close: 1922

Change in %: +0.31

18 Micron

Close: 1749

Change in %: +0.69

19 Micron

Close: 1649

Change in %: +0.67

Authentico Indicator

Close: 1940

Change in %: +0.26

Forecast

Sales resume next Tuesday across all three markets.

Auction offering – current week

Selling Centres for week 42

Market          Sale          Offered             Sold       Passed In

North                      S 42                     5733                          4354                24.1%

South                     M 42                     7856                         6450                17.9%

West                       F 42                      4508                         3113                30.9%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 43                       T-W                             5599

South                     M 43                       T-W                            18930

West                       F 43                        T-W                            6988

 

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

Life Cycle Assessment at The Schneider Group

How to define and create a Sustainable Wool Business?

As society is combatting climate change, businesses around the world are contributing through the development and implementation of their own sustainability strategies. Unfortunately, sustainability is a very broad word, surrounded by subjectivity in most cases. At The Schneider Group, we didn’t want to be trivial about it so we searched for facts and figures. The first step in this long journey is to know where we stand in order to know where we need to go and what steps we need to take in order to get there.

Establishing what is through Life Cycle Assessment

To find our starting point, we decided to perform a Life Cycle Assessment (LCA) for our production, and our wool top. This led to measuring the impact of all our six mills – 4 wool and 2 cashmere mills – as well as the farming stage. Within the LCA we focused on the four most relevant indicators for our operations: energy consumption, greenhouse gas emissions, water stewardship, and land occupation.

Starting point: 750.000 tonnes of CO2e

In a nutshell, the biggest issue is that for all the wool tops we produce each year as a Group, we emit in the order of 750.000 tonnes of CO2e (carbon dioxide equivalent). Out of this, roughly 35.000 tonnes are from transporting the wool to our mills and processing it; whilst 715.000 tonnes are allocated to the wool production. Yes, amazingly 4,6% of the impact of GHG (greenhouse gases) is for industry and 95,4% for farming. To put things into perspective, according to recent studies from the EU the yearly emission per capita is 4,97 tonnes of CO2e. So The Schneider Group’s processing would equate to a town the size of Kawerau, Huntly or Portland (roughly 7.000 inhabitants); whereas the emissions allocated to the production of the greasy wool consumed by the group on yearly basis would be Geelong or Tauranga (roughly 143.000 inhabitants) in comparison.

Need for accurate methodologies

Based on ongoing wool LCA research by the IWTO, the methodologies of how on-farm impacts are calculated are inaccurate.  We are therefore actively supporting various industry bodies such as the IWTO Sustainable Practices Working Group, UNFCCC, UNECE, and others – to correct these wrong calculations before the laws are made regarding emissions. We believe climate change is the next big frontier we will have to tackle as an industry. It is up to us to let it become a risk factor to our businesses or to turn this into an opportunity for all. We are absolutely sure that growers will be innovating to bring the answers to the table and we will take them to all the stakeholders, including big brands. Proactivity will be key and at The Schneider Group we will start proposing initiatives in the near future around this particular topic.

We are aware that the wool industry already has had a slow start around this subject. The result of this slow start can be seen by looking at the current impact assessment methodology rating farming negatively. However, we have the determination and above all, the conviction that wool and farming is here to save the world. We need to start sitting at the table so we can stop being on the menu.

Read more about sustainability at The Schneider Group here.

EASTERN AUSTRALIAN MARKET REPORT

The Australian dollar is 4.5% stronger against the USD since the last sale day. Market generally firm.

COMMENT

A very small and varied selection with only selected good types available and a high percentage of low yielding, dusty wool on offer.

FLEECE

18.5 / 19.5 micron up to 1% dearer

20.5 / 21.5 micron generally firm

SKIRTINGS

Better lots generally firm, others irregular and easier to buy.

OPEN TOP

Nominally firm.

 

AUSTRALIAN WEEKLY MARKET REPORT

Comment

25,000 bales were eventually sold to the trade this week. This is a better indication of the volume that can realistically be consumed by the market each week with prices more stable at this level. We must avoid wildly fluctuating volumes for sale during this period. The offering of 29,000 bales was 33% less wool than what was announced for sale this time last week. Brokers and growers have considered the circumstances and withdrawn wool that was not realistically for sale. This is a very sensible approach and had a positive influence on the final market outcome. It also resulted in just a 12% passed in rate that allowed those genuine clips that were for sale, a realistic chance. We thank those brokers who worked with their clients to help reduce the volume for sale during this time. This is essential with enormous financial and production pressure on the entire global wool supply chain.

AWEX Eastern Indicator compared with 03/04/2020

Eastern Indicator

Close: 1301

Change in % +1.09

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

Authentico Index Values

15 Micron

Close: 2430

Change in %: +2.57

16 Micron

Close: 2153

Change in %: +1.08

17 Micron

Close: 1916

Change in %: -0.42

18 Micron

Close: 1737

Change in %: +0.64

19 Micron

Close: 1638

Change in %: +0.06

Authentico Indicator

Close: 1935

Change in %: +0.68

Forecast

During such uncertain times, we do expect some more volatility in the short to medium term. An unusual step to allocate an extra sale next week, after Easter, was taken by the rostering committee. This will be a small one-day sale only to be held next Wednesday.

A range of customers, including the Nanjing wool market had, like us, called for a break in sales via a change in the roster. This has been widely discussed by the industry. There is more broad interest in the idea to limit the volume for sale each week as a preferred method to help protect the health and well-being of buyers as well as the financial stability of the market. This option would need government approval as sellers could be considered to be colluding to limit supply. The major brokers could not reach a full consensus on this issue so it’s unlikely to be pursued.

The National Auction Selling Committee (NASC) has reduced the number of lots allowed to be sold in a day as a work health and safety measure to limit the hours buyers are required to spend in the open cry auction environment.

Auction offering – current week

Selling Centres for week 41

Market          Sale          Offered             Sold       Passed In

North                      S 41                     7520                          6444                14.3%

South                     M 41                    16712                        14339                14.2%

West                       F 41                      5263                         4798                  8.8%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 42                       W                             6256

South                     M 42                      W                             10396

West                       F 42                       W                              4871

 

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

FREMANTLE MARKET REPORT

COMMENT

Fleece 15-40 cents dearer, skirtings 20-30 cents dearer and open tops 20 cents dearer.

FLEECE

The fleece market rose again today with better spec wools up to 40-50 cents dearer, while average spec fleece was firm to 10 cents dearer. The finer end was the most affected. Brokers withdrew a large number of lots prior to the sale which resulted in more pressure on the market.

Fleece had a passed-in rate of 5.2%.

SKIRTINGS

Skirtings were generally 20-30 cents dearer.

OPEN TOP

Open tops were generally 20 cents dearer.

 

 

EASTERN AUSTRALIAN MARKET REPORT

Market dearer with a small section of the Sydney catalogue successfully sold by video conference.

COMMENT

A larger percentage of the catalogue (about 25%) was withdrawn prior to sale with sellers coming to the realisation that there is little benefit to offer wool in this market which is not genuinely for sale at this level.

FLEECE

All descriptions up to 2% dearer with a small offering of better specification 17.5 micron and finer the most affected.

SKIRTINGS

All descriptions 1 to 2% dearer.

OPEN TOP

Nominally 1 to 2% dearer.

 

FREMANTLE MARKET REPORT

COMMENT

Fleece 15-30 cents dearer, skirtings 20 cents dearer and open tops 30 cents dearer.

FLEECE

The fleece market rose by 15-30 cents today, with better spec lots the most affected and attracting very strong demand. Poorer spec fleece was firm to 10 cents dearer.

Fleece had a passed-in rate of 14.3%.

SKIRTINGS

Skirtings were generally 20-30 cents dearer.

OPEN TOP

Open tops were generally 30 cents dearer.

 

 

EASTERN AUSTRALIAN MARKET REPORT

Market much more stable.

COMMENT

Market settles around last weeks basis.

FLEECE

Fully firm and tending a little dearer for 19.5 / 21.5 micron.

SKIRTINGS

Best fine skirtings 1% dearer, others firm.

OPEN TOP

Finer types 1% dearer, others firm.

 

FUHRMANN NZ MARKET REPORT

Summary

No wool sales in New Zealand this week.

Comment

Due to the Covid-19 virus, the New Zealand government has introduced an Alert Level 4.  This level means that all non-essential businesses are closed and we are working from home where possible.  All movement from Brokers Woolstores to Woolscours and Dump Stores has been affected with these operations also closed.  As a consequence all wool auctions have been cancelled in both the North and South Island until further notice.

We hope in these uncertain times you and your families are keeping safe.

NEW ZEALAND MARKET REPORT

Summary

No wool sales in New Zealand.

Comment

Due to the Covid-19 virus, the New Zealand government has introduced an Alert Level 4.  This level means that all non-essential businesses are closed and we are working from home where possible.  All movement from Brokers Woolstores to Woolscours and Dump Stores has been affected with these operations also closed.  As a consequence all wool auctions have been cancelled in both the North and South Island until further notice.

We hope in these uncertain times you and your families are keeping safe.