Archive for category: 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.

Comment

The week was highlighted by the designated Tasmanian sale. The offering was of mixed quality but included some very stylish fine and superfine wool. There is no doubt that many buyers are focusing on the mulesing status on these speciality types and those clips that were offered with RWS certification attracted very strong and wide spread interest. The market was extremely well supported across all types and descriptions despite the large national offering. Italian interests were more active in the better offering.

AWEX Eastern Indicator compared with 05/02/2021

Eastern Indicator

Close: 1275

Change in % -0.78

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

Authentico Index Values

15 Micron

Close: 3417

Change in %:  +0.2

16 Micron

Close: 2646

Change in %: -0.9

17 Micron

Close: 2289

Change in %: +1.51

18 Micron

Close: 1929

Change in %: +0.73

19 Micron

Close: 1693

Change in %: +2.61

Authentico Indicator

Close: 2306

Change in %: +0.65

Forecast

The volume offered over the past few weeks was expected to ask some questions about the real underlying strength of the market. The market stability, much more than most would have expected, should set the tone for the coming months. While the Chinese market still dominates, there is no doubt more enquiry and buying interest from other origins.

Auction offering – current week

Market          Sale          Offered             Sold       Passed In

North                      S 33                      13507                      11871                12.1%

South                     M 33                     27620                      24016               13.0%

West                       F 33                       8683                        7644                 12.0%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 34                      T – W                          11594

South                     M 34                      T – W – T                    27397

West                       F 34                       T- W                            9986

 

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

Comment

A degree of panic buying emerged this week. There is no shortage of wool in general terms, with broker warehouses still holding more bales than this time last year. However, there is no doubt a shortage of fine wool and these types are more affected by this squeeze than the other types. There is sufficient interest in all wool sub 18.0 micron, but particularly those 16.0 and finer. It’s not just combing merino types but cardings and crossbred wools were also keenly sought after this week. All current buying is for prompt demand and immediate delivery. The better fine types were well supported to the close of sale while the medium and broader merinos fell late in the sale Thursday.

AWEX Eastern Indicator compared with 22/01/2021

Eastern Indicator

Close: 1291

Change in % +7.40%

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

Authentico Index Values

15 Micron

Close: 3388

Change in %:  +11.08

16 Micron

Close: 2655

Change in %: +2.51

17 Micron

Close: 2255

Change in %: +3.49

18 Micron

Close: 1941

Change in %: +5.49

19 Micron

Close: 1687

Change in %: +7.59

Authentico Indicator

Close: 2297

Change in %: +5.08

Forecast

We have a few sales in February where we expect a better selection of fine wool. There is a fine wool sale next week in Sydney (WK32) that will offer some selected clips from the Goulburn / Yass district. This is followed by the Tasmanian feature sale in Melbourne (WK33) and a New Zealand offering (WK34)  that is expected to offer predominantly fine and superfine types.

The cheaper market in Fremantle on Thursday is expected to flow through to Sydney and Melbourne auctions on Tuesday next week but some expect that the market might not be that bad. For sure it will be cheaper but growers are expected to pass wool in and surely the market sentiment can’t be that much different form one week to the next.

Auction offering – current week

Market          Sale          Offered             Sold       Passed In

North                      S 31                     10244                        9761                4.7%

South                     M 31                     21053                       19756               6.2%

West                       F 31                       8544                         8025               6.1%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 32                      T – W                          13432

South                     M 32                      T – W                          24975

West                       F 32                       T- W                            8417

 

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

Comment

Sales have opened in 2021 on a very positive note. Despite the large national offering and a stronger Australian Dollar against the USD, all types and descriptions were in demand. There was strong interest on the finer microns but it should also be noted that they are in smaller supply than what we would expect. The month of January is often a positive month for the auctions and regardless of the overall global situation, it was very encouraging to see that wool is in demand. The market was well maintained to the close in Fremantle.

AWEX Eastern Indicator compared with 18/12/2020

Eastern Indicator

Close: 1172

Change in % +1.30%

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

Authentico Index Values

15 Micron

Close: 2898

Change in %:  +2.11

16 Micron

Close: 2384

Change in %: +3.74

17 Micron

Close: 2025

Change in %: +0.5

18 Micron

Close: 1744

Change in %: +1.1

19 Micron

Close: 1544

Change in %: +1.58

Authentico Indicator

Close: 2052

Change in %: +1.74

Forecast

We have another large volume national sale next week before volumes are expected to settle a little. There is still some wool held in brokers stores nationally. No doubt that if this current market trend continues, we will see some of this wool come onto the market slowly. It’s not all for sale at these levels and we expect some growers to continue to hold wool as they have done historically. While we might see further easing in the broader merinos and crossbred types, like this week, the fine and superfine merino types are likely to again be well supported in limited supply.

Auction offering – current week

Market          Sale          Offered             Sold       Passed In

North                      S 29                     13168                       11761                 10.7%

South                     M 29                     28573                     25286                11.5%

West                       F 29                      10549                       9531                  9.7%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 30                     T – W                           12,927

South                     M 30                   T – W – T                      27,027

West                       F 30                      T – W                            9,286

 

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

Comment

All types and descriptions rallied this week despite nearly 42,000 bales rostered for sale. As with recent weeks, the eventual offering was less than anticipated. The final volume actually offered was 8% lower and another 5% was passed in below grower expectations despite the positive market. While buyers were actively seeking the better performing types, the shorter knitting types were also keenly supported. Even the crossbred types were dearer after having been generally neglected in recent weeks. According to AWEX reports, M$51.1 worth of wool was sold to the trade over the two sale days.

AWEX Eastern Indicator compared with 04/12/2020

Eastern Indicator

Close: 1198

Change in % +4.72%

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

Authentico Index Values

15 Micron

Close: 2825

Change in %:  +5.69

16 Micron

Close: 2359

Change in %: +3.78

17 Micron

Close: 2064

Change in %: +4.19

18 Micron

Close: 1787

Change in %: +4.50

19 Micron

Close: 1579

Change in %: +3.54

Authentico Indicator

Close: 2067

Change in %: +4.29

Forecast

There is just the one sale remaining before the three-week Christmas recess. Current quantities are listed as around 49,000 bales for the week. This kind of ‘surprise’ increase could well cause some reaction from the trade but we hope and expect only minor movements into the final sale of 2020. Everyone will be hoping for a relatively positive finish. Eventually less wool will be offered and growers have the right to pass their wool in, as they’ve done this year, and this will limit the volume available for sale. There is a shortage of cardings and knitting types and this could flow on to the better combing types. The extra volume next week is likely to be more associated with crossbred fleece and crossbred lamb wool plus some drought affected bales that have been waiting for a better market. Superfine merino and quality fine merino are still in short supply and this is unlikely to change next week despite the quantity.

Auction offering – current week

Market          Sale          Offered             Sold       Passed In

North                      S 24                     9256                        8918                  3.7%

South                     M 24                    21029                      19851                 5.6%

West                       F 24                      7551                         7178                  4.9%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 25                        T / W                       10848

South                      M 25                       T / W                       27961

West                        F 25                        T / W                       10317

 

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