AUSTRALIAN WEEKLY MARKET REPORT

Comment

The Australian dollar has risen by about 5 cents against the USD in the month of February. The Australian dollar is heavily influenced by commodity prices and with iron ore prices surging, the Australian dollar has moved upwards with it. Added to this are signs that the Australian economy is improving.

The AUD strength against the USD was eventually too much for wool prices to sustain. After initially absorbing the currency movement to record an overall increase in USD terms on Tuesday, the market settled over the next two days as interest from our main trade partner in wool, China, was more subdued. As the market eased, the percentage of growers willing to hold their wool for another day increased. With exceptional seasonal conditions and the strength of all other farm commodity prices, growers are more prepared to hold their wool now than they’ve ever been.

Best style and strength NM wool around 17.0 / 18.0 micron was well supported this week by Italian interests in the last reasonable offering of the season. They closed generally firm for the week and have had a positive influence on our Authentico index’s accordingly.

AWEX Eastern Indicator compared with 19/02/2021

Eastern Indicator

Close: 1306

Change in % -0.91

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

Authentico Index Values

15 Micron

Close: 3174

Change in %:  -2.43

16 Micron

Close: 2564

Change in %: -2.36

17 Micron

Close: 2314

Change in %: +1.80

18 Micron

Close: 1973

Change in %: +0.10

19 Micron

Close: 1727

Change in %: -0.69

Authentico Indicator

Close: 2289

Change in %: -0.39

Forecast

We’ve now seen the last of the usual fine wool sales. We expect as we move towards our autumn, that VM will continue to increase and staple strength could be lower. Any drought affected wool that we are now seeing in the eastern markets is wool that has been held by growers since 2020. These will at least have low VM and could help to offset the increase in VM expected from the freshly shorn clips. As a result of this change in supply that’s expected, we’re likely to see interest in the better specification wools sustained while the discount to the inferior types might increase.

Auction offering – current week

Market          Sale          Offered             Sold       Passed In

North                      S 35                      13221                      11227                15.1%

South                     M 35                     26073                     22355               14.3%

West                       F 35                      10844                      7326                32.4%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 36                      T – W                          12715

South                     M 36                   T – W – T                      27852

West                       F 36                      W – T                           9968

 

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

EASTERN AUSTRALIAN MARKET REPORT

Market easier, better lots least affected.

COMMENT

The market tightened a little towards the end of sale as the high passed in rate limited the volume available for sale.

FLEECE

Fine wool most affected. All best descriptions 1% easier, average and inferior wools were 1 to 2% easier.

SKIRTINGS

Up to 1% easier.

OPEN TOP

Slightly easier in a limited selection.

NEW ZEALAND MARKET REPORT

Summary

Market dearer.

Comment

South Island only offering 8,570 bales.  The selection was 40% fleece, 11% shears/hoggets, 12% lambs and 14% associated oddments.  There was also 10% halfbred fleece, 3% halfbred hogget, 7% merino and hogget fleece and 3% merino oddments.  Once again prices increased on the back of the previous weeks levels with all sectors operating.  The good colour fleece was particularly sought after.  The main competition was from the United Kingdom, Europe and China with support from the Sub Continent and local mills.  There was generally a good clearance of finer wools although some growers chose to pass in their wools at these levels.

Fleece

Good colour 10% dearer.

Average colour 10% dearer.

Shears

Crossbred second shear 8 to 10% dearer.

Lambs

Crossbred lambs 5% dearer.

Finer lambs up to 15% dearer.

Oddments

Crossbred oddments including lamb oddments 6% dearer.

Passings

7% Passed In.

Next Auction

North Island only offering 10,300 bales on 4th March.

EASTERN AUSTRALIAN MARKET REPORT

 

COMMENT

Better specification sought after in a deteriorating selection.

FLEECE

Best style fully firm in limited selection.

Good/Ave style par to 1% easier.

SKIRTINGS

Best skirtings FNF firm

B/C Fault par to 1% easier

 

OPEN TOP

Slightly easier in a limited selection.

EASTERN AUSTRALIAN MARKET REPORT

Market currency adjusted as A$ improves.

COMMENT

Better specification keenly sought after in a deteriorating selection.

FLEECE

Best style 17/18.5 micron fully firm in limited selection.

19.0 / 21.5 micron 1% easier

Good/Ave style 1-2% easier.

SKIRTINGS

18.5 micron and finer 1% easier

 

OPEN TOP

Unchanged in a limited selection.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

It has been another very encouraging week for the wool market. Stock levels through the production pipeline have been reduced over the past twelve months and this is leaving many with some interesting decisions to ensure they are not left without stock as global conditions gradually improve. There have been significant improvements in price for the fine wool sector in recent weeks while the selection was favourable. Now that the fine wool offering is dropping off, the focus is shifting to the medium and broader merinos which all advance strongly this week and closed on a very firm note.

AWEX Eastern Indicator compared with 12/02/2021

Eastern Indicator

Close: 1318

Change in % +3.37

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

Authentico Index Values

15 Micron

Close: 3253

Change in %:  -4.8

16 Micron

Close: 2626

Change in %: -0.76

17 Micron

Close: 2273

Change in %: -0.70

18 Micron

Close: 1971

Change in %: +2.18

19 Micron

Close: 1739

Change in %: +2.72

Authentico Indicator

Close: 2298

Change in %: -0.35

Forecast

Another large volume sale next week. The selection is set to deteriorate over the coming months. We’re expecting to see more tender wool and higher VM along with a slow release of grower held drought affected wool that is currently held in store. This should help to maintain pressure on all good specification wool over the short to medium term. Particularly 18.5 micron and finer.

Grass seed or shive is a real problem in the wool combing process. We’re seeing more shive in the offering. Shive is the lightest weight VM in the test but causes the most contamination so we are being cautious during the inspection of the samples.

The market maturity and interest in traceable supply chains and in particular our Authentico Integrity Scheme on traceable wool tops back to the wool grower origin is gaining strong momentum. More and more clients are looking to add a traceable supply chain to their inventory requirements. Now that this option is becoming a commercial reality for our clients, we’re seeing stronger demand for Authentico certified wool.

Auction offering – current week

Market          Sale          Offered             Sold       Passed In

North                      S 34                      11037                      9844                10.8%

South                     M 34                     23588                     21405                9.3%

West                       F 34                       9751                        8839                 9.4%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 35                      T – W                          13710

South                     M 35                   T – W – T                      28336

West                       F 35                       T- W                          10568

 

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

EASTERN AUSTRALIAN MARKET REPORT

Market firm but trending up for better specification.

COMMENT

Better specification keenly sought after in a deteriorating selection.

FLEECE

18.5 micron and finer fully firm

19.0 / 21.5 micron better specification up to 2% dearer in limited supply

19.0 / 21.5 micron 1% dearer

SKIRTINGS

18.5 micron and finer slightly easier

19.0 /19.5 micron fully firm

OPEN TOP

Unchanged in a limited selection.

NEW ZEALAND MARKET REPORT

Summary

Market continues to strengthen.

Comment

Both centres selling today with the South Island offering 5,520 bales and the North Island offering 10,600 bales.  The selection in the North consisted of 30% crossbred fleece, 30% shears, 30% lambs and 10% associated oddments.  In the South the selection was 50% fleece, 30% shears/hoggets, 10% lambs and 10% associated oddments.  Prices increased again this week on the back of last weeks increases with all sectors operating.  The good colour fleece was particularly sought after.  The main competition was from the United Kingdom, Europe and the Sub Continent with support from China and local mills.

Fleece

Good colour 5% dearer.

Average colour sellers favour.

Shears

Crossbred second shear 6% dearer.

Lambs

Crossbred lambs 5% dearer.

Oddments

Crossbred oddments including lamb oddments 4% dearer.

Passings

6% Passed In.

Next Auction

South Island only offering 8,500 bales on 25th February.

FREMANTLE MARKET REPORT

COMMENT

Fleece 60 cents dearer, and skirtings 10-20c dearer, and open tops unchanged.

FLEECE

Fleece prices jumped 50 cents as the auction began and continued to rise throughout the sale. By the close prices were generally 60-70 cents dearer. Best spec wools were again the most affected, but all microns and types rose sharply today.

The passed-in rate for fleece was 2.9%.

SKIRTINGS

Skirtings finished the day around 10-20 cents dearer.

OPEN TOP

Open tops were generally unchanged today.

 

 

EASTERN AUSTRALIAN MARKET REPORT

Medium micron merinos advance strongly.

COMMENT

18.0 micron and broader all dearer today.

FLEECE

17.5 micron and finer generally unchanged but some irregularity in a much more inferior offering

18.0 micron and broader 2 to 3% dearer. Chinese specification most affected.

SKIRTINGS

15.5 / 16.5 micron 1% dearer

17.0 / 18.0 micron firm

18.5 / 19.5 micron 1% dearer

OPEN TOP

1% easier